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Have you evaluated the performance of Charles River Laboratories' (CRL) international operations during the quarter that concluded in March 2025? Considering the extensive worldwide presence of this medical research equipment and services provider, analyzing the patterns in international revenues is crucial for understanding its financial resilience and potential for growth.
In the current global economy, which is more interconnected than ever, a company's success in penetrating international markets is crucial for its financial health and growth journey. Investors must understand a company's dependence on overseas markets, as this offers a window into the company's earnings stability, its ability to benefit from varied economic cycles and its potential for long-term growth.
Being present in international markets serves as a counterbalance to domestic economic challenges while offering chances to engage with more rapidly evolving economies. However, this kind of diversification introduces challenges like currency fluctuations, geopolitical uncertainties and varying market trends.
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 stood at $984.17 million, declining 2.7% year over year. Now, let's delve into CRL's international revenue breakdown to gain insights into the significance of its operations beyond home turf.
Canada accounted for 12.74% of the company's total revenue during the quarter, translating to $125.35 million. Revenues from this region represented a surprise of +29.81%, with Wall Street analysts collectively expecting $96.57 million. When compared to the preceding quarter and the same quarter in the previous year, Canada contributed $119.36 million (11.91%) and $110.4 million (10.91%) to the total revenue, respectively.
Other International, including Brazil and Israel generated $16.67 million in revenues for the company in the last quarter, constituting 1.69% of the total. This represented a surprise of +147.67% compared to the $6.73 million projected by Wall Street analysts. Comparatively, in the previous quarter, Other International, including Brazil and Israel accounted for $17.12 million (1.71%), and in the year-ago quarter, it contributed $16.75 million (1.66%) to the total revenue.
Of the total revenue, $41.94 million came from Asia Pacific during the last fiscal quarter, accounting for 4.26%. This represented a surprise of -4.13% as analysts had expected the region to contribute $43.75 million to the total revenue. In comparison, the region contributed $55.78 million, or 5.56%, and $45.77 million, or 4.52%, to total revenue in the previous and year-ago quarters, respectively.
During the quarter, Europe contributed $263.25 million in revenue, making up 26.75% of the total revenue. When compared to the consensus estimate of $251.8 million, this meant a surprise of +4.55%. Looking back, Europe contributed $263.33 million, or 26.27%, in the previous quarter, and $276.32 million, or 27.32%, in the same quarter of the previous year.
For the full year, the company is expected to generate $3.89 billion in total revenue, down 4.1% from the previous year. Revenues from Canada, Other International, including Brazil and Israel, Asia Pacific and Europe are expected to constitute 11% ($428.73 million), 0.6% ($25.05 million), 4.8% ($185.42 million) and 25.7% ($1 billion) of the total, respectively.
In a world where international interdependencies and geopolitical conflicts are ever-increasing, Wall Street analysts closely monitor these trends for companies having international presence to adjust their earnings forecasts. Of course, there are several other factors, including a company's standing within its home borders, that influence analysts' earnings forecasts.
At Zacks, we place significant importance on a company's evolving earnings outlook. This is based on empirical evidence demonstrating its strong influence on a stock's short -term price movements. Invariably, there exists a positive relationship -- an upward revision in earnings estimates is typically mirrored by a rise in the stock price.
The Zacks Rank, our proprietary stock rating tool, comes with an externally validated impressive track record. It effectively utilizes shifts in earnings projections to act as a dependable barometer for forecasting short-term stock price trends.
Charles River, bearing a Zacks Rank #3 (Hold), is expected to mirror the broader market's movements in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
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This article originally published on Zacks Investment Research (zacks.com).
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