IDEXX Laboratories' Q2 Earnings Top Estimates, Analyst Maintain Outperform Citing Resilient Animal Health Market

IDEXX Laboratories Inc IDXX reported Q2 FY23 sales of $943.63 million, beating the consensus of $927.84 million. Adjusted EPS was $2.67 versus $1.56 a year ago.

The sales increased by 10% reported and 10% organic, driven by Companion Animal Group (CAG) growth of 11% and organic and Water revenue growth of 10% reported and 9% organic. 

CAG Diagnostics recurring revenue growth of 11% was reported, and 12% organic was supported by double-digit organic revenue growth in U.S. and international regions, reflecting solid demand for veterinary services and benefits from IDEXX execution drivers. 

Veterinary software, services, and diagnostic imaging systems revenue grew 12% as reported and 13% organically.

For FY23, the company boosted FY23 revenue guidance from $3.615 billion-$3.70 billion to $3.66 billion-$3.715 billion, compared to the consensus of $3.67 billion.

IDEXX forecasts an EPS of $9.64-$9.90 compared to the consensus of $9.69 and prior guidance of $9.33-$9.75.

William Blair analysts Ryan Daniels, Brandon Vazquez, and Jack Senf reaffirm the resilience of the global animal health market this quarter, with the Idexx business franchise standing out distinctly, strengthening their belief in the company's organic growth trajectory. The analyst maintains the Outperform rating for the stock.

Analysts perceive the veterinary healthcare market as a reliable investment sanctuary for investors. It is resilient to recession, marked by fairly constant demand, robust pricing power, and favorable demographic trends. 

Price Action: IDXX shares closed down by 4.04% at $532.30 on Tuesday.