On Jan 7, we issued an updated research report on IDEXX Laboratories, Inc. (IDXX) – a developer, manufacturer and distributer of products and services primarily for the companion animal veterinary, livestock and poultry, water testing and dairy markets.
IDEXX posted an impressive third quarter of 2014 with top and bottom-line beats. Earnings per share of $1.05 were up 25% year over year, also ahead of the Zacks Consensus Estimate by 19.3%. Revenues of $383.5 million increased 13.4% and surpassed the Zacks Consensus Estimate of $372 million.
The year-over-year growth on both fronts is indicative of the company’s consistent growth via organic means. We are, at the same time, encouraged by the company’s global performance during the third quarter. Backed by a strong and consistent Companion Animal Group (CAG) show in the quarter, the company raised its fiscal 2015 revenue outlook.
Among its future plans, IDEXX is currently focusing on the Catalyst Dx test to facilitate the global rollout of Catalyst One in 2015. This, in turn, is expected to result in market expansion for the company and garner higher profitability. Bolstered by a strong cash position, the company also remains committed to delivering incremental returns to investors, thereby leveraging earnings power.
However, dependence on third party distributors remains as an overhang. In addition, intense competition and currency fluctuations warrant caution.
IDEXX currently carries a Zacks Rank #3 (Hold).
Key Picks in the Sector
However, investors interested in the medical instrument sector can consider better-ranked stocks like Edwards Lifesciences Corp. (EW), AngioDynamics Inc. (ANGO) and Hansen Medical, Inc. (HNSN). All the three stocks carry a Zacks Rank #2 (Buy).
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