It hasn't been a great afternoon session for IDEXX Laboratories investors, who have watched their shares sink by -2.9% to a price of $538.1. Some of you might be wondering if it's time to buy the dip. If you are considering this, make sure to check the company's fundamentals first to determine if the shares are fairly valued at today's prices.
IDEXX Laboratories's P/B and P/E Ratios Are Higher Than Average:
IDEXX Laboratories, Inc. develops, manufactures, and distributes products primarily for the companion animal veterinary, livestock and poultry, dairy, and water testing markets worldwide. The company belongs to the Health Care sector, which has an average price to earnings (P/E) ratio of 30.21 and an average price to book (P/B) ratio of 4.08. In contrast, IDEXX Laboratories has a trailing 12 month P/E ratio of 54.9 and a P/B ratio of 34.45.
IDEXX Laboratories's PEG ratio is 3.13, which shows that the stock is probably overvalued in terms of its estimated growth. For reference, a PEG ratio near or below 1 is a potential signal that a company is undervalued.
Growing Revenues With a Flat Capital Expenditure Trend:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (MM) | $2,213 | $2,407 | $2,707 | $3,215 | $3,367 | $3,588 |
| Revenue Growth | n/a | 8.75% | 12.45% | 18.79% | 4.73% | 6.55% |
| Operating Margins | 22% | 23% | 26% | 28% | 27% | 30% |
| Net Margins | 17% | 18% | 22% | 23% | 20% | 23% |
| Net Income (MM) | $377 | $428 | $582 | $745 | $679 | $823 |
| Net Interest Expense (MM) | $35 | $31 | $33 | $30 | $40 | $46 |
| Depreciation & Amort. (MM) | $83 | $88 | $96 | $105 | $112 | $114 |
| Earnings Per Share | $4.26 | $4.89 | $6.71 | $8.6 | $8.03 | $10.03 |
| EPS Growth | n/a | 14.79% | 37.22% | 28.17% | -6.63% | 24.91% |
| Diluted Shares (MM) | 88 | 88 | 87 | 87 | 85 | 82 |
| Free Cash Flow (MM) | $261 | $304 | $541 | $636 | $394 | $680 |
| Capital Expenditures (MM) | $139 | $155 | $107 | $120 | $149 | $150 |
| Current Ratio | 0.85 | 0.94 | 1.82 | 1.25 | 0.89 | 1.43 |
| Total Debt (MM) | $653 | $836 | $908 | $924 | $924 | $620 |
| Net Debt / EBITDA | 0.92 | 1.16 | 0.66 | 0.75 | 0.8 | 0.24 |
IDEXX Laboratories benefits from growing revenues and a flat capital expenditure trend, strong margins with a positive growth rate, and low leverage. The company's financial statements show a strong EPS growth trend and irregular cash flows.
