Analyst Charles Rhyee of TD Cowen maintained a Hold rating on Charles River Labs (CRL – Research Report), with a price target of $260.00.
Geoff Meacham has given his Hold rating due to a combination of factors related to Charles River Labs’s financial outlook and market conditions. While the fourth quarter saw ongoing challenges in demand, the company’s adjusted earnings per share (EPS) guidance for the coming year is seen as a positive indicator of potential fundamental improvement starting in the second quarter. Management expresses confidence in the second half of the year, anticipating revenue growth driven by multiple factors, including increased biotechnology funding. Nevertheless, the conservative guidance for the full year—factoring only a modest improvement in demand—suggests that the company is setting achievable targets, which may provide room for upward revisions later on.
Management’s outlook for the first quarter of 2024 predicts a significant decline in adjusted EPS; however, there is a sense of optimism for a stronger performance in the latter half of the year, bolstered by expected industry tailwinds. Key elements contributing to this outlook include projected cost savings from restructuring, a decrease in the tax rate after the first quarter, and the anticipated ramp-up of new facilities and acquisitions. These factors, combined with a favorable macro environment monitoring biotech funding trends and venture capital activity, underpin the company’s confidence in a revenue upswing and margin improvement as the year progresses, thus informing the Hold rating.
See today’s best-performing stocks on TipRanks >>
TipRanks tracks over 100,000 company insiders, identifying the select few who excel in timing their transactions. By upgrading to TipRanks Premium, you will gain access to this exclusive data and discover crucial insights to guide your investment decisions. Begin your TipRanks Premium journey today.
Charles River Labs (CRL) Company Description:
Charles River Laboratories International, Inc. is an early-stage contract research company, which provides essential products and services to help pharmaceutical and biotechnology companies, government agencies and academic institutions. It operates through the following segments: Research Models & Services, Discovery & Safety Assessment and Manufacturing Support. The Research Models & Services segment comprises of the production and sale of research models, and also offers services designed to support its client’s use of research models in screening non-clinical drug candidates. The Discovery & Safety Assessment segment offers discovery and safety assessment services, both regulated and non-regulated, in which it include both in vivo and in vitro studies, supporting laboratory services, and strategic preclinical consulting and program management to support product development. The Manufacturing Support segment provides endotoxin and microbial detection, avian vaccine and biologics testing solutions. The company was founded by Henry L. Foster in 1947 and is headquartered in Wilmington, MA.
Read More on CRL:
