August 30, 2012
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of clinical laboratory service Bio-Reference Laboratories (Nasdaq: BRLI ) slid as much as 10% earlier in the trading session following the release of its third-quarter results.
So what: For the quarter, Bio-Reference recorded a 25% increase in profits to $0.45 on a 16% rise in revenue to $172.3 million. Although EPS was $0.02 above expectations, total sales came in $1.4 million shy of Wall Street's expectations. Furthermore, Bio-Reference's guidance of 15% revenue growth and "around 20%" net income growth failed to impress investors.
Now what: Is anyone really that surprised? In mid-July, Quest Diagnostics (NYSE: DGX ) cut its full-year revenue forecast to just 1%-2% growth from previous forecasts of 2%-2.5% growth, while Laboratory Corporation of America (NYSE: LH ) fell just shy of both EPS and revenue projections. All three are suffering from a weak spending environment and global uncertainties. Bio-Reference is definitely the most robust growth story of these three, but until the global picture improves, don't expect big moves higher out of this sector.
Craving more input? Start by adding Bio-Reference Laboratories to your free and personalized watchlist so you can keep up on the latest news with the company.