If You Invested $1000 in Bio-Rad Laboratories 10 Years Ago, This Is How Much You'd Have Now
How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.
Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.
What if you'd invested in Bio-Rad Laboratories (BIO) ten years ago? It may not have been easy to hold on to BIO for all that time, but if you did, how much would your investment be worth today?
Bio-Rad Laboratories' Business In-Depth
With that in mind, let's take a look at Bio-Rad Laboratories' main business drivers.
Hercules, CA-headquartered Bio-Rad Laboratories is a manufacturer and global supplier of clinical diagnostics and life science research products in the healthcare, analytical chemistry life science research and other markets. It offers a wide portfolio of products and systems which allow the separation of complex chemical and biological materials and discovery, analysis and purification of their components.
Bio-Rad has extensive and direct distribution channels in over 35 countries outside the United States through subsidiaries which focus on sales, customer service and product distribution.
The company operates through two reportable segments. Together, these segments offer over 9,000 different products and services. The details are as follows:
Life Science (47.9% of total revenues in 2021; constant exchange rate or CER growth rate was 12% from 2020): This segment designs, manufactures, markets and services reagents, apparatus and instruments utilized for biological research. The products manufactured are marketed in university and medical school laboratories, pharmaceutical and biotechnology companies, food testing laboratories and government and industrial research facilities. The company believes Life Science Segment represents a global market opportunity of approximately $9 billion annually.
Clinical Diagnostics (51.8%; down 13.6%): This business markets and distributes products to reference laboratories, hospital laboratories, state newborn screening facilities, physicians’ office laboratories, transfusion laboratories as well as insurance and forensic testing laboratories. It designs, manufactures, distributes and services automated test systems, informatics systems, test kits and specialized quality controls for the healthcare market. According to Bio-Rad, the Clinical Diagnostics segment presents an annual global market opportunity of roughly $12 billion.
In October 2019, Bio-Rad acquired all the issued and outstanding shares of a foreign distributor for approximately $4.2 million. In August 2019, the company acquired all the issued and outstanding membership interests of Exact Diagnostics, LLC for approximately $60.0 million. Both buyouts added to the Clinical Diagnostics arm.
Bottom Line
While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Bio-Rad Laboratories ten years ago, you're probably feeling pretty good about your investment today.
A $1000 investment made in May 2012 would be worth $5,084.59, or a 408.46% gain, as of May 25, 2022, according to our calculations. Investors should note that this return excludes dividends but includes price increases.
Compare this to the S&P 500's rally of 198.44% and gold's return of 15.01% over the same time frame.
Analysts are anticipating more upside for BIO.
Bio-Rad exited the first quarter of 2022 with better-than-expected earnings and revenues. The company continued to experience recovery in most of its key global markets, with strong growth of Process Media and Droplet Digital PCR products. Further, strength in its key product lines across major geographic regions buoys optimism. Within the Diagnostics business, the company witnessed recovery in its Immunohematology business. Expansion of both margins is an added plus. Over the past year, Bio-Rad has outperformed its industry. However, Bio-Rad’s Life Sciences arm registered a year-over-year decline, primarily attributed to lower qPCR product revenues due to the decline in COVID-related demand. The year-over-year rise in operating costs is worrying. Further, foreign-exchange woes and pandemic-led macroeconomic troubles persist.
Shares have gained 5.11% over the past four weeks and there have been 1 higher earnings estimate revisions for fiscal 2022 compared to none lower. The consensus estimate has moved up as well.
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