Eurofins Scientific’s organic sales growth was 3.5% in the third quarter, showing a gradual acceleration over the last nine months. Shares were trading about 2% higher intraday on Oct. 21.
ERF is trading within a range we consider fairly valued.
Price
€83.26
Fair Value
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Uncertainty
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1-Star Price
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5-Star Price
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Economic Moat
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Capital Allocation
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Bulls Say, Bears Say
Bulls
There are still sufficient acquisition targets left for Eurofins in its growth markets, allowing it to have continuous high growth while fortifying its competitive positioning through its hub-and-spoke network.
Bears
Eurofins has achieved leading positions in key markets primarily through acquisitions. In the future, Eurofins may overpay on acquisitions to meet top-line targets.
Eurofins, headquartered in Luxembourg, is a decentralized network of life sciences companies that provide various analytical tests and laboratory services. These include tests to evaluate the safety, identity, composition, authenticity, purity, origin, and traceability of various biological substances and products. Eurofins operates over 950 laboratories in 61 countries. Its revenue from Europe, North America, and the rest of the world contributes approximately 50%, 40%, and 10% of total revenue, respectively. It is active in food, feed, and environmental testing ("life"), biopharmaceutical services, diagnostic services and products, and consumer and technology products testing, which contribute approximately 40%, 30%, 20%, and 10% respectively.