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Neogen’s Performance Compared to Its Peers

Gabriel Kane

US Equity Market Update for September 21, 2015

(Continued from Prior Part)

Neogen and its peers

An analysis of Neogen’s income statement in 1Q16 follows:

  • The gross profit margins of Neogen (NEOG), IDEXX Laboratories (IDXX), Bio-Rad Laboratories (BIO), Thermo Fisher Scientific (TMO), VWR (VWR), and Bio-Techne (TECH) are 50.48%, 56.31%, 55.25%, 45.47%, 27.61%, and 67.22%, respectively.

  • The EPS (earnings per share) of Neogen, IDEXX Laboratories, Bio-Rad Laboratories, Thermo Fisher Scientific, VWR, and Bio-Techne are $0.25, $0.60, $0.97, $1.28, $0.14, and $0.69, respectively.

An analysis of Neogen’s balance sheet in 1Q16 follows:

  • The current ratio of Neogen, IDEXX Laboratories, Bio-Rad Laboratories, Thermo Fisher Scientific, VWR, and Bio-Techne are 8.74, 1.07, 4.31, 1.02, 1.51, and 6.24, respectively.

An analysis of Neogen’s valuation follows:

  • The PE (price-to-earnings) ratios of Neogen, IDEXX Laboratories, Bio-Rad Laboratories, Thermo Fisher Scientific, VWR, and Bio-Techne are 54.84x, 40.66x, 41.95x, 25.83x, 17.01x, and 32.82x, respectively.
  • The PBV (price-to-book value) ratios of Neogen, Bio-Rad Laboratories, Thermo Fisher Scientific, VWR, and Bio-Techne are 5.22x, 1.72x, 2.43x, 2.65x, and 4.16x, respectively.

According to the above findings, Neogen outperformed its peers based on the current ratio, PE ratio, and PBV ratio. However, based on the gross profit margin and EPS, the peers are way ahead of Neogen.

ETFs that invest in Neogen 

The PowerShares S&P SmallCap Health Care ETF (PSCH) invests 2.20% of its holdings in Neogen. PSCH tracks a cap-weighted index of small-cap healthcare companies taken from the S&P SmallCap 600 Index.

The SPDR S&P Health Care Equipment ETF (XHE) invests 1.16% of its holdings in Neogen. XHE tracks an equal-weighted index of US healthcare equipment and supply companies.

The PowerShares DWA SmallCap Momentum ETF (DWAS) invests 0.67% of its holdings in Neogen. DWAS tracks an index of 200 small-cap securities with the best relative strength indicators. These indicators are determined by Dorsey Wright’s proprietary methodology.

Neogen compared to its ETFs

An analysis of Neogen’s price movement follows:

  • The YTD (year-to-date) price movements of Neogen, PSCH, XHE, and DWAS are -0.46%, 22.41%, -45.11%, and 3.57%, respectively.

An analysis of Neogen’s valuation follows:

  • The PE ratios of Neogen, PSCH, XHE, and DWAS are 54.84x, 52.49x, 98.31x, and 79.70x, respectively.
  • The PBV ratios of Neogen, PSCH, XHE, and DWAS are 5.22x, 3.47x, 4.36x, and 4.04x, respectively.

According to the above findings, the ETFs outperformed Neogen based on the price movement and PE ratio. Based on the PBV ratio, Neogen is way ahead of its ETFs.

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