Bio-Rad Earnings: In-Line Results and Shares Undervalued Despite Downward Guidance Revision

Wide-moat Bio-Rad’s second-quarter earnings were in line with our expectations. Revenue for the three months was $638 million, or a 6% year-over-year decline. Although the first half of the year has largely performed in line with expectations, Bio-Rad significantly revised its full-year guidance downward. Despite this revision, we maintain our fair value estimate of $430 per share and view shares as undervalued. Although we expect 2024 to be lackluster in terms of revenue growth and margin improvement, next year we think Bio-Rad can resume its progress in increasing operating profit margins.