Abcam Downgrade: Analyst Trims Expectations Amid Activist Investor Engagement and Potential Bid Anticipation

RBC Capital Markets has downgraded Abcam PLC ABCM from Outperform to Sector Perform with a price target of $22, down from $23.

The analyst writes that it has always liked Abcam's fundamentals but sees activist investor engagement and anticipation of a potential bid as likely to drive material share volatility.

Earlier today, Abcam filed an investor presentation, urging shareholders to vote against all resolutions at the company's July 12 Extraordinary General Meeting.

The company points out that under CEO Alan Hirzel's leadership, Abcam has transformed as a business, created significant value for all stakeholders, and outperformed the market.

The company is on track to deliver its 2024 revenue and profit margin goals.

The analyst says any major players in the life science tools space could be interested in Abcam, with its leading position in high-margin research antibodies, strong growth and margin trajectory, and brand and distribution reach. 

Thermo Fisher Scientific Inc TMO, Danaher Corporation DHR, Merck KGaA MKGAF MKKGY, Agilent Technologies Inc A, Bio-Techne Corp TECH and Revvity Inc RVTY could be interested, based on their EBITDA, current leverage and an assumption of max 3x leverage.

Private equity would potentially be interested.

Price Action: ABCM shares are down 6.95% at $20.76 on the last check Tuesday.