BioReference Laboratories, Inc. (BRLI) analysts are expecting double-digit growth rates for the next few years. Thanks to the weight of the market though, the valuations are looking attractive.
Currently shares are a Zacks #1 Rank (Strong Buy) and look like they are picking up steam.
Company Description
BioReference Laboratories is a full-service laboratory in the U.S. offering clinical testing. Some areas of focus are molecular diagnostics, anatomical pathology, and women’s health.
Consistent Growth
When BioReference reported quarterly results on Aug 25, investors were pleased to see strong growth in each business segment. Revenue was up 22%, to $148 million.
Earnings grew 26% and came out to $0.36 per share. That was 2 cents better than the Zacks Consensus Estimate, giving the company its 12th surprise in the past 13 quarters.
Attractive Growth Rates
Estimates did not move much on the earnings news, but were already projecting solid growth rates. Estimates for 2011 are averaging $1.14, which would be a 22% growth rate.
Next year’s Zacks Consensus Estimate is at $1.35, an 18% increase. Analysts expect the long-term growth rate to average 18% for the next few years.
Valuations Look Good
And you don’t have to worry about paying too much for that growth. Shares of BRLI are going for 16 times forward estimates, which puts the PEG ration at 0.9 times.
The price to sales ratio is at 0.9 times as well and the price to book is just under 3 times.
The Chart
BRLI did see a boost on the earnings surprise, but the weight of the late-summer market dragged shares lower. Recently though, the MACD is showing a nice shift in momentum and the stock could be set for a nice run higher.
Bill Wilton is the Aggressive Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the Zacks Small Cap Trader service
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