Back to top

Image: Bigstock

Why Charles River (CRL) International Revenue Trends Deserve Your Attention

Read MoreHide Full Article

Have you looked into how Charles River Laboratories (CRL - Free Report) performed internationally during the quarter ending June 2024? Considering the widespread global presence of this medical research equipment and services provider, examining the trends in international revenues is essential for assessing its financial resilience and prospects for growth.

The global economy today is deeply interlinked, making a company's engagement with international markets a critical factor in determining its financial success and growth path. It has become essential for investors to comprehend how much a company relies on these foreign markets, as this understanding reveals the firm's potential for consistent earnings, its capacity to harness different economic cycles, and its overall growth prospects.

Presence in international markets can act as a hedge against domestic economic downturns and provide access to faster-growing economies. However, this diversification also brings complexities due to currency fluctuations, geopolitical risks and differing market dynamics.

In our recent assessment of CRL's quarterly performance, we discovered notable trends in its overseas revenue sections, which are typically modeled and scrutinized by Wall Street analysts.

The company's total revenue for the quarter amounted to $1.03 billion, marking a decrease of 3.2% from the year-ago quarter. We will next turn our attention to dissecting CRL's international revenue to get a clearer picture of how significant its operations are outside its main base.

A Look into CRL's International Revenue Streams

Asia Pacific accounted for 4.9% of the company's total revenue during the quarter, translating to $50.39 million. Revenues from this region represented a surprise of -10.07%, with Wall Street analysts collectively expecting $56.03 million. When compared to the preceding quarter and the same quarter in the previous year, Asia Pacific contributed $45.77 million (4.5%) and $59.86 million (5.7%) to the total revenue, respectively.

Europe generated $271.38 million in revenues for the company in the last quarter, constituting 26.5% of the total. This represented a surprise of -4.12% compared to the $283.04 million projected by Wall Street analysts. Comparatively, in the previous quarter, Europe accounted for $276.32 million (27.3%), and in the year-ago quarter, it contributed $272.98 million (25.8%) to the total revenue.

During the quarter, Canada contributed $125.24 million in revenue, making up 12.2% of the total revenue. When compared to the consensus estimate of $104.47 million, this meant a surprise of +19.89%. Looking back, Canada contributed $110.4 million, or 10.9%, in the previous quarter, and $117.65 million, or 11.1%, in the same quarter of the previous year.

Of the total revenue, $7.68 million came from Other International, including Brazil and Israel during the last fiscal quarter, accounting for 0.8%. This represented a surprise of +220.08% as analysts had expected the region to contribute $2.4 million to the total revenue. In comparison, the region contributed $16.75 million, or 1.7%, and $2.68 million, or 0.3%, to total revenue in the previous and year-ago quarters, respectively.

International Market Revenue Projections

For the current fiscal quarter, it is anticipated by Wall Street analysts that Charles River will report a total revenue of $1.04 billion, which reflects an increase of 1.6% from the same quarter in the previous year. The revenue contributions are expected to be 5% from Asia Pacific ($52.39 million), 27.2% from Europe ($283.99 million), 11.1% from Canada ($115.59 million) and 0.3% from Other International, including Brazil and Israel ($2.57 million).

Analysts expect the company to report a total annual revenue of $4.11 billion for the full year, marking a decrease of 0.5% compared to last year. The expected revenue contributions from Asia Pacific, Europe, Canada and Other International, including Brazil and Israel are projected to be 5.2% ($214.21 million), 27.7% ($1.14 billion), 11% ($452.21 million) and 0.7% ($26.52 million) of the total revenue, in that order.

Wrapping Up

Relying on international markets for revenues, Charles River faces both prospects and perils. Thus, tracking the company's international revenue trends is essential for accurately projecting its future trajectory.

In an era of growing international ties and escalating geopolitical disputes, financial analysts on Wall Street pay keen attention to these developments to fine-tune their earnings estimations for businesses operating across borders. It's important to note, however, that a range of additional variables, like a company's local market status, also play a crucial role in shaping these forecasts.

We at Zacks strongly focus on the dynamic earnings forecast of companies, given that empirical studies have demonstrated its potent impact on the immediate price movement of stocks. Invariably, there's a positive relationship -- upward earnings predictions often result in an increase in stock prices.

With an impressive externally audited track record, our proprietary stock rating tool - the Zacks Rank - harnesses the power of earnings estimate revisions and serves as an effective indicator of a stock's near-term price performance.

Currently, Charles River holds a Zacks Rank #5 (Strong Sell), signifying its potential to underperform the overall market's performance in the forthcoming period. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Examining the Latest Trends in Charles River's Stock Value


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Charles River Laboratories International, Inc. (CRL) - free report >>

Published in