Charles River Reports Q2 Results in Line With Expectations; Maintaining $260 FVE, Shares Undervalued

Charles River reported second-quarter results (earlier in the month) largely in line with our expectations. Quarterly revenue reached $973 million, representing a 6% year-over-year increase. The company continues to benefit from strong booking demand and a robust backlog. While foreign exchange headwinds and interest rate increases are impacting the company in the near term, we maintain our positive long-term outlook. Our fair value estimate of $260 per share remains unchanged, and we view the stock as undervalued, currently trading in 4-star territory. We maintain our narrow moat and stable trend ratings, which are based on the company’s robust competitive position and expansive offerings of preclinical services.