Bio-Techne reported a 2% revenue decline for its third fiscal quarter and a 34.2% adjusted operating income margin, down 70 basis points. Revenue from biotech customers declined in the high single digits. Shares sold off 16% from the previous day's close.
The firm's reputation for excellent proteomic reagents and instruments allows it to generate high profit margins and strong cash flow.
Bears
Bio-Techne's long-term strategy relies on acquisitions, and the company may have difficulty finding suitable targets because of high valuations or scarcity. Additionally, it may fail to successfully integrate and scale up an acquired business.
Based in Minnesota, Bio-Techne is a life sciences manufacturer supplying consumables and instruments for the pharma, biotech, academic, and diagnostic markets. It reports in two segments: protein sciences (about 75% of revenue) and diagnostics and genomics (25%). The protein sciences segment sells reagents and analytical instruments used in life sciences research, including antibodies used in protein analysis. The diagnostics and genomics segment sells diagnostic reagents, molecular diagnostics, and spatial biology products. The United States accounts for about 55% of revenue. The firm also has operations in Europe, the Middle East, and Africa (20% of sales), the UK (5%), and Asia-Pacific (15%), with the rest of the world accounting for the remaining 5%.