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Neogen (NEOG) Earnings and Revenues Beat Estimates in Q4
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Neogen Corporation (NEOG - Free Report) reported earnings of 33 cents per share in the fourth quarter of fiscal 2018. The figure considersadjustment for a 4-for-3 stock split effective Dec 29, 2017.The bottom line beat the Zacks Consensus Estimate by 33.3% and increased 10% from the year-ago quarter’s tally.
Revenues increased 8.5% on a year-over-year basis to $109.3 million, ahead of the Zacks Consensus Estimate of $108 million.
For the full year, net income was $1.21 per share, 40.7% above the year-ago number. While the top line increased 11% annually to $402.3 million.
Neogen Corporation Price, Consensus and EPS Surprise
Per Neogen, revenues and net income for the fourth quarter and the full year established new all-time highs for the company.
Revenues in Detail
Food Safety Segment: Revenues at the segment totaled $52.1 million, up 7.9% on solid overall organic growth in the reported quarter. Full-year revenues increased 14% to $196 million, partly aided by the acquisitions of Quat-Chem and Rogama. There was a 13% growth in sales of test kits to detect drug residues in milk, partially driven by new test kits to detect drug residues of special concern in Eastern Europe.
The company witnessed 12% rise in sales of Neogen's rapid diagnostics to detect food allergens including gluten, milk, soy and peanuts in fiscal 2018. There was an 18% jump in sales of general sanitation products from the year-ago period. Sales of the foodborne pathogen detection tests increased 16% including a 27% improvement in the sale of tests to detect Listeria.
Animal Safety Segment: The segment recorded revenues of $57.1 million, reflecting a 13.1% climb from the year-ago quarter’s count. Fiscal 2018 revenues for this segment came in at $206.2 million, an 8.4% gain from the prior-year period’s level.
Full-year growth at the segment was mainly driven by a sales uptrend in the genomics business, an 11% rise in rodent control product line, 15% uptick in sales of animal care products along with a 13% raise in sales of drug detection products and a 23% hike in sales of detectable needles.
The worldwide genomics business unit recorded a 22% increase in fiscal 2018. Per management, this growth is attributable to the September 2017 buyout of the Neogen Australasia genomics laboratory in Australia. Also, the upside is backed by robust revenues grossed from the genomic testing of beef and dairy cattle, swine, poultry and companion animals at the other existing locations.
Margin Details
Gross margin contracted 219 basis points (bps) to 45.4% during the fourth quarter, largely riding on a 15.2% escalation in cost and an unfavorable product mix.
Adjusted operating income was $19.9 million, accounting for 18.2% of sales in the fourth quarter compared with $19 million or 19.2% of sales a year ago, which implies a 105-bps contraction.
Full-year gross margin was 47.3%, signifying a contraction of 30 basis points. According to Neogen, this was the impact of lower-margin revenues drawn from the consolidations of Quat-Chem and Rogama and the lower sales of higher-margin natural toxin kits, which partially offset the improved gross margins in the genomics business from lower raw material costs for both comparative periods.
Our Take
Neogen exited the fiscal 2018 on a solid note. We are encouraged by the year-over-year better-than-expected earnings and revenues. We believe that Neogen is steadily progressing on the back of its four-pronged strategy. Moreover, we are upbeat about the accretive integrations and an expanding international footprint, which should consistently drive results in the coming period.
Zacks Rank & Key Picks
Neogen currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader medical space are Genomic Health , Align Technology, Inc. (ALGN - Free Report) and Integer Holdings Corp. (ITGR - Free Report) .
Genomic Health is expected to release second-quarter fiscal 2018 results on Aug 7. The Zacks Consensus Estimate for the quarter's adjusted EPS is pegged at 7 cents and for revenues stands at $91.9 million. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Align Technology is expected to release second-quarter 2018 results on Jul 25. The Zacks Consensus Estimate for the period's adjusted EPS is $1.09 and for revenues, $469.2 million. The stock carries a Zacks Rank of 1.
Integer Holdings is slated to release second-quarter 2018 results on Apr 25. The Zacks Consensus Estimate for the company’s adjusted bottom line in the to-be-reported quarter stands at 90 cents and for its top line at $381.8 million. The stock is a Zacks #1 Ranked player.
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And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Neogen (NEOG) Earnings and Revenues Beat Estimates in Q4
Neogen Corporation (NEOG - Free Report) reported earnings of 33 cents per share in the fourth quarter of fiscal 2018. The figure considersadjustment for a 4-for-3 stock split effective Dec 29, 2017.The bottom line beat the Zacks Consensus Estimate by 33.3% and increased 10% from the year-ago quarter’s tally.
Revenues increased 8.5% on a year-over-year basis to $109.3 million, ahead of the Zacks Consensus Estimate of $108 million.
For the full year, net income was $1.21 per share, 40.7% above the year-ago number. While the top line increased 11% annually to $402.3 million.
Neogen Corporation Price, Consensus and EPS Surprise
Neogen Corporation Price, Consensus and EPS Surprise | Neogen Corporation Quote
Per Neogen, revenues and net income for the fourth quarter and the full year established new all-time highs for the company.
Revenues in Detail
Food Safety Segment: Revenues at the segment totaled $52.1 million, up 7.9% on solid overall organic growth in the reported quarter. Full-year revenues increased 14% to $196 million, partly aided by the acquisitions of Quat-Chem and Rogama. There was a 13% growth in sales of test kits to detect drug residues in milk, partially driven by new test kits to detect drug residues of special concern in Eastern Europe.
The company witnessed 12% rise in sales of Neogen's rapid diagnostics to detect food allergens including gluten, milk, soy and peanuts in fiscal 2018. There was an 18% jump in sales of general sanitation products from the year-ago period. Sales of the foodborne pathogen detection tests increased 16% including a 27% improvement in the sale of tests to detect Listeria.
Animal Safety Segment: The segment recorded revenues of $57.1 million, reflecting a 13.1% climb from the year-ago quarter’s count. Fiscal 2018 revenues for this segment came in at $206.2 million, an 8.4% gain from the prior-year period’s level.
Full-year growth at the segment was mainly driven by a sales uptrend in the genomics business, an 11% rise in rodent control product line, 15% uptick in sales of animal care products along with a 13% raise in sales of drug detection products and a 23% hike in sales of detectable needles.
The worldwide genomics business unit recorded a 22% increase in fiscal 2018. Per management, this growth is attributable to the September 2017 buyout of the Neogen Australasia genomics laboratory in Australia. Also, the upside is backed by robust revenues grossed from the genomic testing of beef and dairy cattle, swine, poultry and companion animals at the other existing locations.
Margin Details
Gross margin contracted 219 basis points (bps) to 45.4% during the fourth quarter, largely riding on a 15.2% escalation in cost and an unfavorable product mix.
Adjusted operating income was $19.9 million, accounting for 18.2% of sales in the fourth quarter compared with $19 million or 19.2% of sales a year ago, which implies a 105-bps contraction.
Full-year gross margin was 47.3%, signifying a contraction of 30 basis points. According to Neogen, this was the impact of lower-margin revenues drawn from the consolidations of Quat-Chem and Rogama and the lower sales of higher-margin natural toxin kits, which partially offset the improved gross margins in the genomics business from lower raw material costs for both comparative periods.
Our Take
Neogen exited the fiscal 2018 on a solid note. We are encouraged by the year-over-year better-than-expected earnings and revenues. We believe that Neogen is steadily progressing on the back of its four-pronged strategy. Moreover, we are upbeat about the accretive integrations and an expanding international footprint, which should consistently drive results in the coming period.
Zacks Rank & Key Picks
Neogen currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader medical space are Genomic Health , Align Technology, Inc. (ALGN - Free Report) and Integer Holdings Corp. (ITGR - Free Report) .
Genomic Health is expected to release second-quarter fiscal 2018 results on Aug 7. The Zacks Consensus Estimate for the quarter's adjusted EPS is pegged at 7 cents and for revenues stands at $91.9 million. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Align Technology is expected to release second-quarter 2018 results on Jul 25. The Zacks Consensus Estimate for the period's adjusted EPS is $1.09 and for revenues, $469.2 million. The stock carries a Zacks Rank of 1.
Integer Holdings is slated to release second-quarter 2018 results on Apr 25. The Zacks Consensus Estimate for the company’s adjusted bottom line in the to-be-reported quarter stands at 90 cents and for its top line at $381.8 million. The stock is a Zacks #1 Ranked player.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>