Bio-Techne Corp (TECH)

Conclusion

Bio-Techne Corp (TECH.US) sells life science reagents, instruments and services for research, diagnostics and bioprocessing, through its Protein Sciences and Diagnostics and Spatial Biology segments. The share price is 72.83 USD as of 2026-11-09, giving a market capitalisation of 11.44 billion USD.

The verdict is overvalued. The fair value band runs from 44.94 to 67.41 USD with a midpoint of 56.18 USD, a margin of safety of -22.9% at the current price, so the price sits above the top of the band. Today's P/E of 66.5x compares with a ten-year median of 60.5x, a premium of 9.9%, and EV/EBITDA of 37.3x compares with a median of 35.5x. Price to free cash flow of 37.1x is below its median of 48.2x. The DCF gives 28.36 USD per share at a discount rate of 11.3%. The reverse DCF implies revenue growth of 20.9% a year, while revenue has compounded at 5.5% over five years and free cash flow per share at -2.5%.

The case rests on a strong balance sheet and clean earnings: net debt to EBITDA of -0.21, an Altman Z-score of 16.1 and a Piotroski score of 8 out of 9. The weakest numbers are return on invested capital of 8.3% against a WACC of 11.1%, a P/E of 66.5x, and a three-year EPS compound growth of -13.1%.

Financial health

Financial strength is green, held up by a net cash position (net debt to EBITDA of -0.21), a current ratio of 2.28, a quick ratio of 1.53 and interest coverage of 42.9x. Debt to equity is 0.13. The Altman Z-score is 16.1, in the safe zone, although the Altman model was designed for manufacturers and its reading is only indicative here. Insolvency risk: low, about 0.05% by the estimate of the Ohlson model over one to two years. The company's debt fell over the past five years, with a debt versus revenue growth reading of -0.13. Balance sheet strength is not a concern for this company.

Earnings quality

Earnings quality is green. Free cash flow conversion is 1.79 on a trailing basis and averaged 1.28 over five years, so reported profit is backed by cash. The accrual ratio is -0.04, which means cash earnings exceed accounting earnings. Stock-based compensation is 3.5% of revenue, and free cash flow after it is 265.1 million USD. The share count fell at a compound rate of 0.6% a year over five years, reflecting buybacks. The Piotroski score is 8 out of 9 and the Beneish M-score of -2.54 reads as unlikely to indicate manipulation. The company beat earnings estimates in five of the last eight quarters, with an average surprise of 3.4%. Estimates for next year have been revised up, with three upward revisions and none down in the last 30 days, and next-year EPS growth is expected at 13.4%.

Profitability

Profitability is yellow. The gross margin is 65.8% against a ten-year median of 66.5%, the operating margin is 19.6% against 21.2%, and the net margin is 14.0% against 15.0%. Margins are close to their history. Return on invested capital is 8.3% against a WACC of 11.1%, a difference of -2.8 percentage points, so the company currently earns less than its cost of capital. The five-year median ROIC is 8.7%. Return on equity is 7.9%. The DuPont split shows a net margin of 15.0%, an asset turnover of 0.45 and an equity multiplier of 1.27, so the return is not inflated by leverage. It is held back by low asset turnover.

Growth

Growth is green, although most of the individual growth figures are only neutral. Revenue compounded at 2.3% over three years, 5.5% over five years and 9.3% over ten years. Revenue grew in nine of the ten comparable years. EPS compounded at -13.1% over three years, 6.0% over five years and 5.2% over ten years. Free cash flow per share compounded at 7.9% over three years, but -2.5% over five years and 7.0% over ten years. Recent growth has been uneven: the three-year EPS decline is the weak point, while consensus expects EPS growth of 13.4% next year.

Valuation

Valuation is red. The P/E of 66.5x is a premium of 9.9% to its ten-year median of 60.5x, and EV/EBITDA of 37.3x is a premium of 5.1% to 35.5x. Price to free cash flow, price to sales and price to book trade at discounts of 22.9%, 13.3% and 17.7% to their medians. The fair value band is 44.94 to 67.41 USD with a midpoint of 56.18 USD, a margin of safety of -22.9% at 72.83 USD. The DCF gives 28.36 USD per share at a discount rate of 11.3%, with the terminal value making up 48.1% of the total. The fair value from historical multiples is 83.99 USD. The reverse DCF implies growth of 20.9%, against revenue growth of 5.5% and free cash flow per share growth of -2.5% over five years. The dividend yield is 0.4%, and dividends absorb 16.2% of free cash flow. The fair value is an order-of-magnitude estimate built on fixed assumptions, not a price target.

Risks

The weakest numbers would each weigh on the case if they worsened. A return on invested capital below the cost of capital (8.3% against 11.1%) means growth currently adds no value, and a further decline in margins would widen that gap. The P/E of 66.5x leaves little room if earnings disappoint, and the three-year EPS decline of -13.1% shows that earnings have already fallen. The DCF of 28.36 USD sits well below the price, and the reverse DCF implies growth of 20.9% against 5.5% delivered. The analysis does not include a debt maturity schedule or revenue by segment, so refinancing risk and the contribution of each segment cannot be assessed. The bond yield and the fair value rest on fixed assumptions, and a change in the risk-free rate of 4.89% would move the discount rate.