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BIO Q3 Earnings and Revenues Surpass Estimates, Stock Up Aftermarket

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Bio-Rad Laboratories, Inc. (BIO - Free Report) posted third-quarter 2024 adjusted earnings per share (EPS) of $2.01, which beat the Zacks Consensus Estimate by 57%. However, the bottom line decreased 13.7% from the prior-year quarter’s level.

The quarter’s adjustments primarily eliminate the impacts of certain non-recurring items, such as the amortization of purchased intangibles, restructuring costs and losses from the change in the fair market value of equity securities.

The company’s GAAP EPS was $23.34, up 541.2% from the year-ago figure of $3.64.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Following the earnings announcement, BIO stock rose 3.8% at yesterday’s after-market trading. 

BIO's Revenues in Detail

Revenues of $649.7 million surpassed the Zacks Consensus Estimate by 2%. The figure also increased 2.8% year over year (up 3.4% at constant exchange rate or CER).

BIO's Segmental Analysis

Sales in the Life Science segment totaled $260.9 million, down 1% year over year and 0.6% at CER. The currency-neutral year-over-year sales decline was broad-based. It was primarily due to weakness in the biotech and biopharma end markets.

Net sales in the Clinical Diagnostics segment totaled $388.8 million, up 5.6% on a year-over-year basis and 6.4% at CER. Increased demand for quality control products and a favorable comparison for immunology products, which were adversely impacted by supply constraints in the third quarter of 2023, primarily drove the currency-neutral year-over-year sales increase.

Margins

In the quarter under review, Bio-Rad’s gross profit rose 6% to $355.9 million. The gross margin expanded 167 basis points (bps) to 54.8%. 

Operating expenses amounted to $291.4 million, up 19.1% year over year. Operating profit totaled $64.5 million, down 29.1% from the prior-year level. The operating margin contracted 447 bps to 9.9%.

BIO's Financial Update

Bio-Rad exited the third quarter of 2024 with cash and cash equivalents (including short-term investments) of $1.63 billion compared with $1.62 billion at the end of second-quarter 2024. Total debt (including current maturities) at the end of the third quarter was $1.20 billion, which remained flat sequentially.

Cumulative net cash flow from operating activities totaled $331 million compared with the year-ago figure of $293.9 million.

2024 Guidance

Bio-Rad maintained its revenue guidance for full-year 2024.

The company still anticipates non-GAAP currency-neutral revenues to decline 2.5% to 4%. The Zacks Consensus Estimate for revenues is pegged at $2.58 billion, implying a 3.4% decline from the 2023 reported figure.

The adjusted operating margin for the full year is now projected to be in the range of 12.7-13.2% (up from the earlier guidance of 12-13%).

Bio-Rad Laboratories, Inc. Price, Consensus and EPS Surprise

Our Take

Bio-Rad exited the third quarter with better-than-expected results, with both earnings and revenues beating estimates. Within the Clinical Diagnostics segment, increased demand for quality control products benefited from the timing of shipments and contributed to the stronger pull-through consumables. In line with this, the company registered broad-based growth in all regions with a solid performance in the immune hematology business. 

On the flip side, the Life Science group continued to experience a modest pace of recovery, reflecting ongoing soft demand in biotech and pharma in China. 

Meanwhile, decreasing operating profit and operating margin contraction are discouraging. 

Zacks Rank & Key Picks

BIO currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks from the broader medical space are Phibro Animal Health (PAHC - Free Report) , Veracyte (VCYT - Free Report) and HealthEquity (HQY - Free Report) .

Phibro Animal Health reported fourth-quarter fiscal 2024 adjusted earnings of 41 cents per share, which topped the Zacks Consensus Estimate by 20.6%. Revenues of $273.2 million beat the Zacks Consensus Estimate by 4.1%. PAHC sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

PAHC’s fiscal 2025 earnings are expected to surge 31.9% compared with the industry’s 11.6% growth. The company’s earnings surpassed estimates in three of the trailing four quarters and missed in one, the average surprise being 4.1%.

Veracyte, sporting a Zacks Rank #1 at present, posted second-quarter 2024 earnings of 30 cents per share, which beat the Zacks Consensus Estimate of a loss of 3 cents. Revenues of $114.4 million surpassed the Zacks Consensus Estimate by 14%.

VCYT has an estimated earnings growth rate of 115.7% for 2024 compared with the industry’s 13.7%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 328.4%.

HealthEquity, carrying a Zacks Rank #2 (Buy) at present, reported a second-quarter fiscal 2025 adjusted earnings of 86 cents per share, which surpassed the Zacks Consensus Estimate by 22.9%. Revenues of $299.9 million topped the Zacks Consensus Estimate by 5.4%.

HQY has an estimated long-term earnings growth rate of 28.2% compared with the industry’s 13.4%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 19.8%.

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