Narrow-Moat Eurofins Posts Flat Full-Year Revenue Growth; Shares Undervalued

Narrow-moat Eurofins reported decent full-year results, given global macroeconomic headwinds, the war in Ukraine, and a steep decline in COVID-19-related sales. Organic revenue was flat year over year while the company felt the pressures of the mentioned headwinds on an EBITDA and net profit basis, both down 23% year over year. Management provided solid 2023 guidance and its long-term outlook through 2027. The company’s guidance is roughly in line with our projections, and we are maintaining our EUR 80 fair value estimate. Shares appear undervalued, especially given the market’s likely overreaction to the headwinds in the fourth-quarter and full-year results.