Idexx stock skidded early Monday despite an "impressive" fourth-quarter report as investors continue debating weakness in vet visits.
Maine-based Idexx LaboratoriesIDXX sells diagnostic tools for veterinarians. During the December-ended quarter, the company earned $3.08 a share on $1.09 billion in sales. Both measures beat expectations, growing 18% and 14%, respectively.
William Blair analyst Ryan Daniels noted Idexx stock has been trading near record highs despite ongoing debates about weak vet visit trends. Investors are closely watching Idexx's launch in the cancer space and the inVue Dx, a slide-free cellular analyzing tool.
"While we do not expect fourth-quarter results to end the debate about vet visits and pricing impacts on the overall industry volume growth, we believe Idexx's current innovation cycle should provide incremental confidence that the company has the levers it needs to meet expectations in this still-challenging environment," Daniels said in a report.
In morning trades, Idexx stock fell more than 3% to 650.13. Shares fell below the lower boundary of a flat base with a buy point at 769.98, according to MarketSurge.
Leerink Partners analyst Daniel Clark described Idexx Labs' report as "impressive."
"The ongoing momentum of the company's established (diagnostics) franchise, in addition to the growing inVue launch (6.4K placements in 2025), sets the stage for what should be another year of solid growth," he said in a client note.
For the year, Idexx guided to $14.29 to $14.80 per share and $4.632 billion to $4.72 billion in sales. The midpoints of Idexx's outlook beat Street calls for earnings of $14.50 per share and $4.66 billion in sales.
Clark says the initial guidance of 8% to 10% growth for recurring companion animal diagnostics and 7% to 9% total organic growth "may have some upside as the year progresses."
He kept his outperform rating on Idexx stock.
Similarly, William Blair's Daniels rates Idexx as outperform. He sees the pet health market as "relatively resilient" with an aging population following the "2020 puppy-boom." Younger people are also more willing to spend heavily on their pets, he said.
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