VWR Buys SEASTAR CHEMICALS to Boost Americas Division

VWR Corporation VWR, a leading provider of laboratory products and services, recently announced the acquisition of SEASTAR CHEMICALS Inc. This Canada-based company is a manufacturer of high purity reagents applied in the global research, laboratory and microelectronics industries. Financial details of the deal have been kept under wraps.

For quite some time now, VWR has been having a hard time with regard to its share price. Over the last three months, the company has been consistently trading below the Zacks categorized Medical - Dental Supplies industry. As per the last share price movement, the company lost 8.1%, comparing unfavorably with the 1.9% gain of the broader industry.

While we are awaiting the company’s fourth-quarter report by the next month, we believe the latest buyout will add zing to the company’s Americas segment’s performance going ahead and help in reviving its share price trend thereby.

SEASTAR CHEMICALS is a leading producer of ultra-pure acid and base products used for detecting trace elements for environmental, food and semiconductor analysis and testing. The company utilizes proprietary purification technology, advanced analytical techniques and a quality customized bottling process to maintain ultra-high purity levels.

VWR Corporation Price

 

VWR Corporation Price | VWR Corporation Quote

Management claims that SEASTAR CHEMICAL’s aim to ensure safety, quality and innovation makes it a suitable pick for VWR. The latter’s ultra-high purity product lines would help VWR better serve the customers of its Americas division. The division entails operations in the U.S. and Canada as well as Puerto Rico, Mexico and select countries in Central and South America, including Costa Rica, Brazil, Argentina and Chile. The segment includes 59 facilities across 8 countries.

As per a Global Industry Analysts Report, the global laboratory reagents market is estimated to be worth $23.4 billion by 2022, driven by growing opportunities in pharmaceutical research. Thus, we can conclude that the acquisition will help expand VWR’s foothold globally and cash in on the untapped opportunities in this growing market.

Zacks Rank & Key Picks

VWR carries a Zacks Rank #4 (Sell). Better-ranked medical stocks are Penumbra, Inc. (PEN), Neogen Corporation (NEOG) and Cardiovascular Systems, Inc. (CSII). Penumbra sports a Zacks Rank #1 (Strong Buy) while Neogen and Cardiovascular carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.  

Penumbra surged 51.9% over the last one year, compared to the S&P 500’s 20.9%. The company has an impressive four-quarter average earnings surprise of over 100%.

Neogen gained 26.7% in the past one year, way better than the S&P 500. The stock has an impressive long-term earnings growth of 16.7% for the next five years compared to the industry average of 15.2%.

Cardiovascular Systems rallied 102.1% in the past one year, way higher than the S&P 500.  It has a positive average earnings surprise of 31.8%.

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