Repligen (RGEN) Reports
Repligen, a bioprocessing specialist, reported Q3 results this morning that should be good enough to keep the stock stable, and hopefully get it moving back in the right direction. Recall the stock moved out of the small-cap index and into the mid-cap index recently, which likely drove much of the September sell-off. This report should wave the all-clear flag for mid-cap funds that are nibbling around the edges.
Revenue was up 40% to $69.5 million (beating expectations) and adjusted EPS of $0.26 beat by $0.07. Organic growth was up 28%. Guidance for the full year was bumped up to a range of $267 million to $270 million, implying 31% to 32% growth. All good.
There isn’t any major change in the trends. The company’s Filtration and Chromatography (including OPUS pre-packed single-use columns) businesses continue to do well and were up 38% combined, while the addition of C Technologies (acquired in April) added about $7 million in the quarter (roughly 10% of total revenue). To jog your memory, C Tech was an analytics company with a portfolio of spectroscopy products used mainly in biopharmaceutical manufacturing. The acquisition helps build out Repligen’s Process Analytics business. Management said the proteins business was down some but is expected to bounce back in Q4 and ultimately be up 15% on the year. Management also said its exposure to gene therapy continues to grow and now makes up almost 15% of total revenue.
The bottom line here is there was nothing not to like and the business continues to do very well. Capacity expansions are ongoing to help Repligen make more OPUS columns, which should keep that business cranking through 2020 and beyond. Cash on hand is up almost $320 million, to $514 million—meaning Repligen should have the capital to complete more acquisitions.
Shares were up early on the report and have stayed modestly in the green, despite the deterioration in the broad market today. I think this report is good enough to attract more investors into Repligen. BUY.