IDXX – Market expectations are for Uniform ROA to reach new peaks, but management may have concerns about growth, segment gains, and ProCyte
July 26, 2021
- IDEXX Laboratories, Inc. (IDXX:USA) currently trades at a historical high relative to UAFRS-based (Uniform) earnings, with a 75.1x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may have concerns about the sustainability of growth, segment gains, and the rollout of ProCyte.
- Specifically, management may lack confidence in their ability to sustain clinical revenue growth, higher benefits from new patient growth, and strong gains across all of their market segments, particularly in North America. Moreover, they may have concerns about the growth momentum of IDEXX in international markets and the rollout of their next-gen hematology analyzer, ProCyte One. Furthermore, management may lack confidence in their ability to meet their organic revenue growth projections for CAG diagnostics, maintain high international customer engagement in SNAP Pro, and achieve Opex savings. They may also have concerns about the continued execution of customer centric solutions as well as the enhancement of their value proposition and differentiation.