Neogen’s Q4 results were met with a strong positive market reaction, reflecting the company’s return to positive core growth and substantial margin improvement. Management attributed the quarter’s performance to operational changes, including a sharper focus on cost structure and commercial execution. CEO Mike Nassif emphasized the shift to a process-oriented approach in the commercial organization, stating, “We are implementing a rigorous process-oriented approach to commercial excellence.” The addition of new leadership and targeted product focus, especially in food safety and sample collection, also contributed to the sequential margin expansion.
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Neogen (NEOG) Q4 CY2025 Highlights:
- Revenue: $224.7 million vs analyst estimates of $209.7 million (2.8% year-on-year decline, 7.2% beat)
- Adjusted EPS: $0.10 vs analyst estimates of $0.07 (50% beat)
- Adjusted EBITDA: $23.55 million vs analyst estimates of $39.17 million (10.5% margin, 39.9% miss)
- The company lifted its revenue guidance for the full year to $850 million at the midpoint from $830 million, a 2.4% increase
- EBITDA guidance for the full year is $175 million at the midpoint, above analyst estimates of $165.8 million
- Operating Margin: -2.4%, up from -198% in the same quarter last year
- Market Capitalization: $2.04 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Neogen’s Q4 Earnings Call
- Bob Lovick (CJS Securities) asked about the onboarding and immediate impact of new executives. CEO Mike Nassif responded that “the caliber and experience of these professionals” allowed for rapid integration and focus on fundamentals.
- Lovick (CJS Securities) inquired about sample collection’s margin headwinds. CFO Brian Rigsby detailed sequential improvements and projected a return to profitability for the product line in the second half of the year.
- David Westenberg (Piper Sandler) questioned whether the outlook was conservative due to new leadership or macro factors. Nassif emphasized a prudent, credibility-focused approach in guidance, while Rigsby echoed that the team is settling in and prioritizing consistency.
- Westenberg (Piper Sandler) asked about one-time revenue tailwinds. Rigsby cited a $2 million insecticide benefit in animal safety but highlighted overall growth as primarily organic, not driven by unusual items.
- Brandon Vazquez (William Blair) explored the reasons for improved forecasting and commercial results. Nassif attributed success to weekly, cross-functional forecasting and a cultural shift toward supporting the sales team.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will watch for (1) further progress in operational efficiency, particularly in sample collection and inventory management, (2) successful integration and impact of new commercial leadership on sales execution and customer retention, and (3) the completion and effects of the genomics business divestiture. Monitoring end-market demand trends and the pace of recovery in food and animal safety segments will also be essential for assessing Neogen’s ongoing transformation.
Neogen currently trades at $9.41, up from $7.38 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).
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