Value
3.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.0 |
| P/S | 3.6 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 3.3 |
| PEG | 3.4 |
| Analyst target | 6.0 |
- ▸Forward P/E: 33.3x
- ▸PEG: 3.52
IDXX · Why this verdict
Why IDEXX Laboratories (IDXX) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.3/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
IDEXX Laboratories is a wide-moat, high-quality franchise with a perfect four-quarter earnings beat record and best-in-class margins, but the stock trades at a forward P/E of 34.5x with only 8% headroom to the analyst consensus target — a thin asymmetry that, combined with a confirmed price downtrend, argues for maintaining rather than adding to exposure.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The business carries a wide economic moat with 25% net margins, a financial health score of 8 out of 9, and quality metrics that rank best-in-class versus peers — characteristics that have historically supported the ability to sustain pricing power across multiple business cycles. Quality breakdown | Net margin remains at or above 25% for the next 4 consecutive quarters, confirming that pricing power is durable. | →Stable |
| CounterThe 10-K flags a single supplier as a high concentration risk; a disruption to that relationship could force expensive renegotiation or alternative sourcing that structurally compresses the margin profile that underpins the quality thesis. | ||
At a forward P/E of 34.5x and a PEG of 3.65, the stock screens expensive relative to its growth rate, and with only 8% headroom to the analyst consensus target the risk/reward is below the threshold for a full position — a rich multiple can persist, but it leaves little margin of safety. Bear case | If this concern is wrong, the forward P/E multiple compresses below 25x within 2 quarters as earnings growth accelerates and closes the gap between valuation and fundamentals. | →Stable |
| CounterPremium multiples on moat-holding franchises can persist for years when the underlying business continues compounding earnings; the risk/reward, while below the asymmetry bar, remains directionally favorable at roughly 1.5-to-1. | ||
The company has beaten EPS estimates in all four of the last four quarters with an average positive surprise of roughly 6%, suggesting management consistently sets guidance below what the business actually delivers. Earnings | A fifth consecutive positive EPS surprise is delivered at the next earnings release, approximately 48 days out. | →Stable |
| CounterBeat magnitude has been compressing sequentially — the two most recent quarters came in at 1.7% and 4.8% above estimates, down from 8.1% and 10.0% — raising the question of whether the era of material upside surprises is nearing its end. | ||
The stock sits below its 200-day moving average with the average itself declining at 1.2% per month — a confirmed downtrend — suggesting near-term technical headwinds that could extend the underperformance even as the fundamental business remains intact. Momentum breakdown | Price rises more than 15% from current levels to above $655 and sustains that level for 3 consecutive weeks, confirming the technical downtrend has reversed. | →Stable |
| CounterThe death-cross signal has been exempted from negative impact because the underlying quality and momentum scores remain strong; MACD is already improving, and volume accumulation is rising, suggesting the price weakness may be a temporary pullback within a longer uptrend rather than a structural breakdown. | ||
The business carries a wide economic moat with 25% net margins, a financial health score of 8 out of 9, and quality metrics that rank best-in-class versus peers — characteristics that have historically supported the ability to sustain pricing power across multiple business cycles.
→StableQuality breakdown
- Expectation
- Net margin remains at or above 25% for the next 4 consecutive quarters, confirming that pricing power is durable.
CounterThe 10-K flags a single supplier as a high concentration risk; a disruption to that relationship could force expensive renegotiation or alternative sourcing that structurally compresses the margin profile that underpins the quality thesis.
At a forward P/E of 34.5x and a PEG of 3.65, the stock screens expensive relative to its growth rate, and with only 8% headroom to the analyst consensus target the risk/reward is below the threshold for a full position — a rich multiple can persist, but it leaves little margin of safety.
→StableBear case
- Expectation
- If this concern is wrong, the forward P/E multiple compresses below 25x within 2 quarters as earnings growth accelerates and closes the gap between valuation and fundamentals.
CounterPremium multiples on moat-holding franchises can persist for years when the underlying business continues compounding earnings; the risk/reward, while below the asymmetry bar, remains directionally favorable at roughly 1.5-to-1.
The company has beaten EPS estimates in all four of the last four quarters with an average positive surprise of roughly 6%, suggesting management consistently sets guidance below what the business actually delivers.
→StableEarnings
- Expectation
- A fifth consecutive positive EPS surprise is delivered at the next earnings release, approximately 48 days out.
CounterBeat magnitude has been compressing sequentially — the two most recent quarters came in at 1.7% and 4.8% above estimates, down from 8.1% and 10.0% — raising the question of whether the era of material upside surprises is nearing its end.
The stock sits below its 200-day moving average with the average itself declining at 1.2% per month — a confirmed downtrend — suggesting near-term technical headwinds that could extend the underperformance even as the fundamental business remains intact.
→StableMomentum breakdown
- Expectation
- Price rises more than 15% from current levels to above $655 and sustains that level for 3 consecutive weeks, confirming the technical downtrend has reversed.
CounterThe death-cross signal has been exempted from negative impact because the underlying quality and momentum scores remain strong; MACD is already improving, and volume accumulation is rising, suggesting the price weakness may be a temporary pullback within a longer uptrend rather than a structural breakdown.
Per-dimension breakdown
Quality
8.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 10.0 |
| Gross margin | 8.4 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Current ratio | 4.4 |
| FCF quality | 5.5 |
| Moat | 8.2 |
| Piotroski F | 8.9 |
- ▸Excellent ROE: 73%
- ▸Strong margins: 25%
- ▸Earnings quality warning: 72% FCF/NI
- ▸Wide economic moat
Growth
5.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 6.1 |
| EPS growth | 5.4 |
Momentum
2.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 6.0 |
| Volume | 0.0 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -1.8%/30d — confirmed downtrend
Sentiment
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 8.3 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 26%
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.9 |
| quality rank | 9.4 |
| growth rank | 5.4 |
- ▸Superior ROE vs peers
- ▸Best-in-class margins
Technical
4.4/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 4.2 |
| support resistance | 4.3 |
| 52w position | 4.6 |
Risk (lower is worse)
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.4 |
| days to cover | 7.5 |
| volatility | 5.1 |
| put call | 5.9 |
| implied vol | 6.9 |
| max pain risk | 7.0 |
| beta | 4.9 |
| debt equity | 6.7 |
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 5.6 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- ASYMMETRY:1.6>=1.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:39d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:2.3<4.5
- DEATH_CROSS:HARD_BLOCK
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
1.62
Upside
+9.6%
Downside
5.9%
Sizing output
AVOID
SetupRANGE_BOUND — RSI 49 mid-range, Bollinger mid-band
EdgeTEMP_HEADWIND — High quality (8.4) with weak momentum (2.3)
SuitabilityAGGRESSIVE — Beta 1.54>1.3
Investment implication
The F-path SELL output reflects an overall score of 5.3 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Quality at 8.4) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:2.3<4.5, DEATH_CROSS:HARD_BLOCK) reinforce the read. Current asymmetry R:R is 1.62 — supplementary context, not the trigger for this path.
The strongest dimensions are Quality at 8.4, Risk (lower is worse) at 6.5, and Catalyst at 6.4; the weakest are Momentum at 2.3, Value at 3.4, and Technical at 4.4. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of 1.62 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1The business carries a wide economic moat with 25% net margins, a financial health score of 8 out of 9, and quality metrics that rank best-in-class versus peers — characteristics that have historically supported the ability to sustain pricing power across multiple business cycles.
Trip ifGross margin falls below 20% for 2 consecutive quarters, indicating pricing power is structurally eroding from the current 25% level.
- P2The company has beaten EPS estimates in all four of the last four quarters with an average positive surprise of roughly 6%, suggesting management consistently sets guidance below what the business actually delivers.
Trip ifEPS falls below consensus by more than 2% in 2 of the next 3 reported quarters.
- P3At a forward P/E of 34.5x and a PEG of 3.65, the stock screens expensive relative to its growth rate, and with only 8% headroom to the analyst consensus target the risk/reward is below the threshold for a full position — a rich multiple can persist, but it leaves little margin of safety.
Trip ifForward P/E multiple compresses below 25x for 2 consecutive quarters, resolving the expensive-valuation concern.
- P4The stock sits below its 200-day moving average with the average itself declining at 1.2% per month — a confirmed downtrend — suggesting near-term technical headwinds that could extend the underperformance even as the fundamental business remains intact.
Trip ifPrice rises above $655 (more than 15% above current $570) and holds for 3 consecutive weeks, confirming the downtrend has reversed.