Table of Contents
- Company profile IDEXX Laboratories – Market leader in diagnostic equipment for veterinary medicine
- IDEXX revenue mix – recurring revenue thanks to the cloud and CAG
- Balance sheet IDEXX Laboratories stock and return on capital
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The latest IDEXX Laboratories quarterly figures for September 2025
- IDEXX Laboratories Levermann Analysis: Key Figures
- Should you buy IDEXX Laboratories stock in 2025?
The number of households with pets worldwide has increased significantly in recent years. Currently, around 50 percent of all global households own at least one pet. In the US, the figure is particularly high at 71 percent. The trend is expected to continue, making stocks related to pet supplies an attractive investment. The ever-increasing average age of pets is another tailwind for companies in this sector. Older pets require more frequent checkups, which also increases the number of laboratory tests per pet.
In addition, demand for animal protein sources is high, which means that global livestock numbers could continue to rise. In the market for veterinary laboratory technology, the US medtech company IDEXX Laboratories (ISIN US45168D1046) has established a monopoly position.
Source: Stock Price
The American company's stock price has increased almost fortyfold over the past 20 years. This corresponds to an annualized return of 20 percent. Over the past five years, the security has achieved a return of only 57 percent amid high volatility.
Company profile IDEXX Laboratories – Market leader in diagnostic equipment for veterinary medicine
The company IDEXX Laboratories was founded in Delaware, USA, in 1983. The American company develops, manufactures, and distributes equipment and software products for the examination, diagnosis, health monitoring, and analysis of animals. IDEXX not only acts as a manufacturer, but has also evolved over the years into a true SaaS (Software-as-a-Service) company.
Source: StocksGuide AI
Put simply, when their beloved four-legged friends fall ill, pet owners often come into contact with IDEXX tools during a visit to the vet. Blood is taken from the animal, urine is analyzed, or other tests are carried out to check vital functions or diseases such as cancer, arthritis, and more. IDEXX offers devices for all of these procedures. The data is then stored in IDEXX's own cloud platform, VetConnect PLUS, and compared with other test series from the database.
IDEXX distinguishes between devices for examining pets (Companion Animal Group, or CAG for short) and livestock, poultry, and dairy farming.
For veterinarians and animal clinic operators, a wide range of software solutions is also offered, ranging from data analysis, inventory management, and payment systems to marketing and corporate communications.
IDEXX has also diversified further with a division for water analysis devices.
IDEXX thus creates customer dependency with its laboratory equipment, as we know it from razors and razor blades.
However, there is a particular focus on sales from the software business, as the following image from the current investor presentation clearly shows.
Source: IDEXX Investor Day 2025
In the software sector, IDEXX has now built up such a broad ecosystem that it seems almost impossible for pet owners, veterinarians, and animal clinic operators to find another, and above all better, solution.
This results in correspondingly high switching costs. This makes IDEXX Laboratories a company with a deep moat.
Source: IDEXX Investor Day 2025
The systems range from the aforementioned software programs for veterinary clinics and practices with workflow tools to applications for communication between pet owners and veterinary clinics to the large VetConnect data pool.
The company's success lies particularly in the CAG sector, as we will see in a moment.
IDEXX revenue mix – recurring revenue thanks to the cloud and CAG
In the past fiscal year 2024, IDEXX Laboratories generated approximately $3.9 billion in revenue.
The CAG segment alone accounted for $3.57 billion, which corresponds to a revenue share of just under 92 percent.
Source: IDEXX Laboratories 10-K 2024
Geographically, the US market accounts for the majority of total sales, with a total share of 65 percent. However, IDEXX management sees considerable scope for further sales growth, particularly in the international market. In fiscal year 2024, the Americans reported higher sales growth (8 percent) in the international sector than in their home market in the US (6 percent).
Both management and investors are paying particular attention to recurring revenues from the laboratory equipment business (VetLab Consumables) as well as the consulting and laboratory business. Customers from 80 countries seek advice from IDEXX and can submit tests for analysis at an IDEXX laboratory. IDEXX also offers courier and express services for this purpose.
Source: IDEXX Laboratories Jahresbericht 2024
Together, these two areas account for around two-thirds of sales. This once again underscores their importance to IDEXX's success.
IDEXX was able to charge higher prices for its services in the past year, while also increasing the number of IDEXX laboratory devices installed and boosting consulting sales volumes. This ensures that management will again enjoy a large share of secure earnings this year.
According to the company, recurring revenue in 2024 was approximately 80 percent. This is an impressive figure for a medtech company and once again highlights the American company's market position.
Although IDEXX's success is closely linked to the pet sector, the company has such a strong market position here that this concentration does not currently pose a risk.
Balance sheet IDEXX Laboratories stock and return on capital
So far, we have seen organic revenue growth for IDEXX, largely resulting from recurring revenues. This information can also be gleaned, albeit somewhat hidden, from the balance sheet.
This is because the American company's balance sheet contains few long-term liabilities and only minor intangible assets.
Source: Financial data
Long-term debt currently stands at just $574 million. This is offset by $1.5 billion in equity capital. Intangible assets of $528 million are also considered low compared to the balance sheet total of around $3.4 billion. This reinforces the impression that IDEXX can increase its sales without making large investments and therefore does not make acquisitions or take on new debt for large investments. Otherwise, we would have seen higher intangible assets and increased debt on the balance sheet.
This is confirmed by the returns on capital.
Source: Financial Health
The ROCE (return on capital employed) of IDEXX Laboratories is a very high 61 percent. With one dollar of total capital (minus current liabilities), the American company was able to generate $0.61 in operating profit.
The ROIC (return on invested capital) is also around 36 percent, which indicates a very good return on capital.
To put this into context, ROIC indicates how efficiently invested capital is used to generate operating profit. IDEXX generates $0.36 in operating profit with every dollar of invested capital.
IDEXX Laboratories therefore scores highly not only with steady organic sales growth, but also with a clean balance sheet and very good returns on capital.
The latest IDEXX Laboratories quarterly figures for September 2025
At the beginning of November 2025, IDEXX Laboratories reported its quarterly figures for the past September quarter.
The figures generated enthusiasm among investors, leading to a jump in the share price.
Source: IDEXX Laboratories
The stock price rose by around 15 percent on the day the quarterly figures were announced. But what excited investors so much that it led to such a significant increase in the value of the security?
The revenue rose by 13 percent to $1.1 billion. As production costs were lower than revenue growth, gross profit rose by 15 percent. This operational leverage was also visible in the operating result, with EBIT increasing by 17 percent to $355 million.
Source: Financial Data
Net profit rose by 18 percent compared to the same quarter last year, reaching $275 million. This corresponds to a margin of 25 percent.
In addition to the very good quarterly figures, management significantly raised its earnings per share forecast and also adjusted recurring revenues upward. Management currently expects earnings per share to be in the range of 20-22 percent. This is likely to have ultimately boosted the share price performance.
The American company's quarterly figures show why IDEXX is a true quality company. High revenue and profit growth, coupled with an upward revision of earnings forecasts.
IDEXX Laboratories Stock Forecast 2025
Analysts expect IDEXX Laboratories to see further single-digit revenue growth in the coming years.
Source: Revenue estimates
The expected sales revenue in 2025 of approximately $4.3 billion is around 11 percent higher than the sales revenue in 2024. An increase to $8 billion is expected for 2032. This corresponds to an annual growth rate of 8 percent.
These are realistic expectations, which could possibly be adjusted further upwards in the coming years.
IDEXX is currently managing to increase its sales by between 8 and 10 percent through price increases. This is despite a decline in the number of visits to veterinarians per pet.
Source: IDEXX Q3 2025 Earningspräsentation
Should these rise again, this could lead to an increase in volume at IDEXX in terms of test kits, examinations, laboratory samples, and data evaluations, which could result in a further acceleration in sales growth.
Experts are even more optimistic about profitability.
Source: Net Margin
For the current fiscal year, the average expectation for net profit is $1 billion. The net margin is expected to be around 24 percent. By 2029, earnings growth is expected to reach $1.6 billion. This corresponds to an annualized increase of 10 percent.
Given that IDEXX is currently reporting significantly higher earnings growth, these estimates appear cautious in the overall context. Analysts may attribute their caution to the current decline in the rate of visits to veterinarians.
The Americans are demonstrating this year that IDEXX Laboratories can grow dynamically regardless of this.
IDEXX Laboratories Levermann Analysis: Key Figures
The IDEXX Laboratories share is currently listed as the top scorer with 4 points according to the Levermann strategy. Unsurprisingly, the American security scores one point in each of the first three categories.
Source: Levermann analysis
The equity ratio is 48 percent, which earns the company its first point.
The EBIT margin contributes another point. It stands at around 29 percent. The return on equity of 55 percent also earns the company a point.
Source: EBIT margin
The consistency of the EBIT margin is impressive. Over the last three years, the operating profit margin has consistently remained above 25 percent of sales.
There are deductions for the valuation. Over the last five years, the price-earnings ratio (P/E ratio) averaged a very high 61. At 54, the P/E ratio for the forecast annual profit for 2025 is also too high not to result in a point deduction. Only a profit multiple of less than 12 would earn a point. Analyst opinions are also currently too positive, as this is considered a contraindicator according to the Levermann strategy. This also results in a point deduction.
The stock can earn one point each for its strong price performance over the last 6 and 12 months.
Another point is added for the market participants' reaction to the latest quarterly figures. The security also receives one point for its earnings growth of 12 percent.
According to the Levermann strategy, IDexx Laboratories shares score well thanks to good price growth and good earnings growth. The return on equity, equity ratio, and EBIT margin are also positive factors. Points are deducted for the very high valuation and analyst opinions.
Valuation of IDEXX Laboratories stock
As already mentioned in the previous section, the valuation of IDEXX Laboratories is very high.
The price-earnings ratio (P/E ratio) is currently (based on the last 12 months) 57; and 56 based on expected annual earnings. Measured against the forecast earnings growth for the coming years, the valuation appears to be very high. The enterprise value/sales (EV/sales) ratio of 14 also appears to be at the upper end of its valuation range for a medtech company, which is still IDEXX's primary business.
Source: Valuation
A certain valuation premium appears justified in view of the Americans' market position, the resulting recurring revenue streams, and the growth potential of the global pet and livestock market. A quality company such as IDEXX is rarely valued by investors at a price-earnings multiple of less than 30, and this has also been the case with IDEXX in the past.
Source: StocksGuide Charts
The average EV/Sales ratio for the last 10 years was 10, which is significantly below the current value of 13. After significant upward and downward fluctuations, the P/E ratio is now at its average value for the last decade.
Source: StocksGuide AI
But all in all, the American security is currently “priced to perfection.” We have already seen the first cracks in the growth trend of the American market for pet medicine in a previous section. Investors should always be aware of the risks of a contraction in multiples due to slowing growth in the pet market.
Should you buy IDEXX Laboratories stock in 2025?
Based on our analysis, IDEXX Laboratories meets all the criteria to be considered a true compounder and quality company.
This type of company combines a very strong market position, steady revenue growth, even stronger earnings growth, and low investment in ongoing operations, which in turn leads to high returns on capital.
However, these “special” companies also tend to have very high valuations. This is no different for IDEXX.
With a P/E ratio of almost 60 and an EV/sales ratio of 14, there is obviously a certain downside risk due to the high multiples.
IDEXX must continue to deliver high growth rates to justify its valuation.
However, there is no sign of caution in analysts' estimates yet.
Source: Target Price
The majority of the 17 analysts continue to rate the security as a buy. Around one-third recommend holding the stock. There are currently no sell recommendations.
Most analysts seem convinced by IDEXX's market position, recurring revenues, and pricing power.
However, a certain amount of skepticism seems justified when considering the latest results and reactions of other stocks in the pet medicine sector.
At Zoetis (No. 1 in the pharmaceutical sector for pets and livestock) and Elanco Animal Health, revenue forecasts have been lowered because costs for pet owners are currently high, leading to less spending on veterinary medicine. This situation is likely to affect IDEXX Laboratories' results sooner or later.
Therefore, the stock may only be a case for the watch list at this time. An EV/sales alert of 9 or below could represent an interesting entry opportunity.
The author and/or persons or companies associated with StocksGuide own or may own shares of Okta. This article represents an expression of opinion and does not constitute investment advice. Please note the legal information.
