Neogen Corporation (NEOG - Free Report) recently announced the acquisition of Livestock Genetic Services to boost its in-house genetic evaluation capabilities and unparalleled global network of animal genomics laboratories. Per management, the takeover will position Neogen as a leading agrigenomics company worldwide.
Not to forget, Livestock Genetic has been a partner to Neogen's genomics business for long. Based in Virginia, Livestock Genetic specializes in genetic evaluation and data management for cattle breeding organizations.
Meanwhile, the financial terms of the agreement have been kept under wraps. The company’s latest development is likely to enhance the Animal Safety segment. The stock has a Zacks Rank #3 (Hold). Share price of Neogen inched down 0.2% to close at $90.70 following the news release.
Over the past year, shares of this food and animal safety products developer have gained 75% compared with the industry’s 20% rise.
Agrigenomics Market Prospects Bright
Per Markets And Markets, the agrigenomics market is projected to reach a worth of $13.56 billion by 2021, at a CAGR of 7.8% from 2016.
Given the solid prospects, the latest development can be considered a timely one.
Animal Safety Segment at a Glance
Neogen’s Animal Safety division manufactures and markets rodenticides and pharmaceuticals, vaccines, topicals, disinfectants, and diagnostic products to the professional animal care market. In the last-reported quarter, the segment recorded revenues of $57.1 million, reflecting a 13.1% uptick from the year-ago quarter. 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. The upside has also been supported by robust revenues from the genomic testing of beef and dairy cattle, swine, poultry and companion animals at the other existing locations.
Neogen’s coveted Listeria Right Now environmental pathogen detection system recently received AOAC (Association of Official Analytical Chemists) approval. The development is likely to strengthen Neogen’s food safety products and services portfolio.
Listeria Right Now is a complete system for conducting environmental Listeria tests with molecular-level accuracy. The system generates results in under an hour, much faster than traditional methods. The technology allows food production and processing facilities to seek and eliminate Listeria more quickly.
Per the Centers for Disease Control and Prevention, the incidence of listeriosis is about 1600 per year in the United States, out of which nearly 200 cases are of pregnant women.
Want More From the Industry?
A few better-ranked stocks in the MedTech space are Penumbra, Inc (PEN - Free Report) , Integer Holdings Corporation (ITGR - Free Report) and Illumina, Inc (ILMN - Free Report) . All the companies sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Penumbra has a long-term expected earnings growth rate of 20%, while the same for Integer Holdings and Illumina is pegged at 15% and 22.1%, respectively.
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