It's been a sad week for Bio-Techne Corporation (NASDAQ:TECH), who've watched their investment drop 10% to US$71.77 in the week since the company reported its yearly result. Revenues of US$1.2b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at US$1.05, missing estimates by 6.1%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Following the latest results, Bio-Techne's twelve analysts are now forecasting revenues of US$1.22b in 2025. This would be a modest 5.4% improvement in revenue compared to the last 12 months. Per-share earnings are expected to increase 2.8% to US$1.10. Before this earnings report, the analysts had been forecasting revenues of US$1.25b and earnings per share (EPS) of US$1.39 in 2025. So there's definitely been a decline in sentiment after the latest results, noting the pretty serious reduction to new EPS forecasts.
It might be a surprise to learn that the consensus price target was broadly unchanged at US$82.55, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Bio-Techne, with the most bullish analyst valuing it at US$95.00 and the most bearish at US$65.00 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Bio-Techne's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 5.4% growth on an annualised basis. This is compared to a historical growth rate of 11% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.7% annually. Factoring in the forecast slowdown in growth, it seems obvious that Bio-Techne is also expected to grow slower than other industry participants.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Bio-Techne going out to 2027, and you can see them free on our platform here.
Before you take the next step you should know about the 1 warning sign for Bio-Techne that we have uncovered.
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