Techne Corp. (TECH) has been a standout performer in 2011, hitting a new all-time high in late May after reporting another solid quarter. That pushed estimates higher, providing more momentum for this Zacks #1 rank stock.
Company Description
Techne Corp and its subsidiaries develop and manufacture biotechnology products and hematology controls primarily in the United States and Europe. The company was founded in 1976 and has a market cap of $2.94 billion.
Although Techne has been grinding higher for most of the year, shares got an extra boost in late May when the company reported another strong quarter that came in ahead of expectations.
Third-Quarter Results
Revenue for the period was up 8.5% from last year to $76 million. Earning also came in strong at 84 cents, 5% ahead of the Zacks Consensus Estimate.
Bio technology net sales, including its other divisions, were up 8% from last year, with North American biotech sales to industrial pharmaceutical and biotech customers was up 9.9%.
Financial Profile
The company emerged from the good quarter with its strong balance sheet well intact, with cash and short-term investments up $49 million from last year to $159 million against no long-term debt.
Estimates
We saw estimates nudge higher on the good quarter, with the current year adding 6 cents to $3.05. The next-year estimate added 16 cents to $3.39, a solid 11% growth projection.
Valuation
In light of recent gains, TECH does look a bit pricey, trading with a forward P/E of 26X, in line with its peers but a premium to the overall market.
12-Month Chart
On the chart, TECH recently hit a new multi-year high after gaining on the good quarter. But in spite of the gains, the stochastic below the chart is signaling that shares recently emerged from over-sold territory. Look for support from the long-term trend on any weakness. Take a look below.
Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the new Zacks Momentum Trader Service.
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