Charles River Reports Strong Q1 Results and Momentum for a Healthy 2021; Raising FVE to $170

Charles River reported strong first-quarter revenue of nearly $825 million, an increase of almost 17% year over year. GAAP net income was $61.5 million, an increase of 21% from first-quarter 2020. We’ve increased our fair value estimate to $170 per share from $162 due to a stronger near-term outlook and a more positive impact from the Cognate BioServices acquisition, which closed at the end of March. We maintain our narrow moat rating, which is based on the intangible assets and switching costs associated with Charles River’s leading research models and related services, including discovery and safety assessment.