Charles River Laboratories International, Inc. (NYSE: CRL)

Sector: Healthcare Industry: Diagnostics & Research CIK: 0001100682
Market Cap 12.13 Bn
P/B 3.56
P/E -145.34
P/S 3.02
ROIC (Qtr) 1.46
Div Yield % 0.00
Rev 1y % (Qtr) -0.49
Total Debt (Qtr) 2.63 Bn
Debt/Equity (Qtr) 0.77

About

Price action

Investment thesis

Bull case

  • Operating cash flow of 749.49M provides exceptional 281.97x coverage of minority interest expenses 2.66M, showing strong core operations.
  • Operating cash flow of 749.49M provides strong 10.60x coverage of stock compensation 70.69M, indicating sustainable incentive practices.
  • Robust free cash flow of 543.67M exceeds capital expenditure of 205.82M by 2.64x, indicating strong organic growth funding capability.
  • Tangible assets of 4.02B provide exceptional 16.91x coverage of deferred revenue 237.73M, showing strong service capability backing.
  • Operating cash flow of 749.49M provides strong 3.15x coverage of deferred revenue 237.73M, indicating service delivery capability.

Bear case

  • Operating cash flow of 749.49M barely covers its investment activities of (192.62M), with a coverage ratio of -3.89, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Cash reserves of 207.10M provide limited coverage of acquisition spending of (2.71M), which is -76.28x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • High receivables of 734.48M relative to inventory of 302.55M (2.43 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • Operating earnings of 86.64M show weak coverage of depreciation charges of 427.14M, with a 0.20 ratio indicating high capital intensity and potential reinvestment needs.
  • Free cash flow of 543.67M represents just -3.81x of debt issuance (142.62M), suggesting concerning reliance on leverage rather than internal cash generation for growth.

Geographical Breakdown of Revenue (2024)

Segments Breakdown of Revenue (2024)

Peer comparison

Companies in the Diagnostics & Research
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 TMO Thermo Fisher Scientific Inc. 234.48 Bn 35.69 5.36 35.68 Bn
2 DHR Danaher Corp /De/ 171.11 Bn 48.85 7.05 16.86 Bn
3 IDXX Idexx Laboratories Inc /De 57.62 Bn 56.08 13.83 1.09 Bn
4 IQV Iqvia Holdings Inc. 42.37 Bn 33.03 2.66 15.19 Bn
5 A Agilent Technologies, Inc. 42.16 Bn 32.36 6.07 3.35 Bn
6 NTRA Natera, Inc. 31.64 Bn -102.32 14.95 0.18 Bn
7 MTD Mettler Toledo International Inc/ 30.89 Bn 36.96 7.84 2.21 Bn
8 WAT Waters Corp /De/ 23.59 Bn 36.37 7.60 1.49 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.96 2.82
EV to Cash from Ops. EV/CFO 19.66 19.55
EV to Debt EV to Debt 5.61 54.87
EV to EBIT EV/EBIT 170.09 18.82
EV to EBITDA EV/EBITDA 25.94 4.36
EV to Free Cash Flow [EV/FCF] EV/FCF 27.10 17.63
EV to Market Cap EV to Market Cap 1.21 1.58
EV to Revenue EV/Rev 3.66 5.06
Price to Book Value [P/B] P/B 3.56 1.35
Price to Earnings [P/E] P/E -145.34 18.88
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) -69.34 -2.00
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 2.86
Dividend per Basic Share Div per Share (Qtr) 0.00 0.19
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 1.94
Interest Coverage Int. cover (Qtr) 0.78 -128.90
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 12.67 -35.01
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -1.46 23.84
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.25
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -46.11 9.72
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -34.56 -444.66
EBIT Growth (1y) % EBIT 1y % (Qtr) -86.59 8.29
EBT Growth (1y) % EBT 1y % (Qtr) -104.83 -6.03
EPS Growth (1y) % EPS 1y % (Qtr) -118.88 15.59
FCF Growth (1y) % FCF 1y % (Qtr) -3.00 56.57
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -8.06 185.75
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.54 0.57
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.01
Cash Ratio Cash Ratio (Qtr) 0.18 1.23
Current Ratio Curr Ratio (Qtr) 1.37 2.70
Debt to Equity Ratio Debt/Equity (Qtr) 0.77 -0.84
Interest Cover Ratio Int Coverage (Qtr) 0.78 -128.90
Times Interest Earned Times Interest Earned (Qtr) 0.78 -128.90
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 12.80 -97.22
EBIT Margin % EBIT Margin % (Qtr) 2.15 -115.64
EBT Margin % EBT Margin % (Qtr) -0.62 -114.24
Gross Margin % Gross Margin % (Qtr) 32.30 44.76
Net Profit Margin % Net Margin % (Qtr) -2.10 -113.12