1. This section appears twice "Operational Missteps
3M refused to transfer its FSD ERP system to Neogen, meaning NEOG needed to set up its own system before bringing manufacturing and distribution of FSD in-house..."
DK, thanks for noting the duplicated section. Very embarrassing. Regarding the latest news, the "news" was kind of a non-event from what I can tell. The company presented at William Blair, reaffirming their guidance cut from April. This solidified the weak 4Q25 and FY25.
You'll recall that back in April, NEOG stock took a nosedive when they initially cut guidance, blaming a softening macro. Given the whipsawing macro environment, I think many short-term-oriented hedge funds thought this was a great opportunity to bet on a NEOG earnings beat as tariffs got pulled off and market sentiment turned. The June 4 confirmation of weak guidance broke this trade and may have created a big unwind in some pods, which explains why, in theory, a non-event (reaffirming guidance from 2 months ago) drove the stock so aggressively. Personally, I took management at their word in April, so this has virtually no impact on my valuation.
The longer-term negative news is that there are some inventory write-downs in 4Q, and those will bleed into the next few quarters. From a cost perspective, who cares, but it shows continued operational sloppiness. Selling Genomics seems fine. I was already assuming the business shrinks to be insignificant by 2027. All-in-all, this looks like a technical sell off not a fundamental one. I ~doubled my position size.
I won't comment on my exact portfolio sizing for a number of reasons, but will say this went from a small position to a medium one. I anticipate continued volatility will give me plenty of opportunity to continue sizing in over time. You should evaluate your own risk appetite and stomach for volatility as you think about sizing as this will likely be a very volatile battleground asset.
IMHO, doubled my position size, small to medium, etc - is useless unless you provide more context. Of course we do our own DD. That is besides the point. No worries. I understand.
Thank you.
1. This section appears twice "Operational Missteps
3M refused to transfer its FSD ERP system to Neogen, meaning NEOG needed to set up its own system before bringing manufacturing and distribution of FSD in-house..."
2. How do you think after the latest news?
DK, thanks for noting the duplicated section. Very embarrassing. Regarding the latest news, the "news" was kind of a non-event from what I can tell. The company presented at William Blair, reaffirming their guidance cut from April. This solidified the weak 4Q25 and FY25.
You'll recall that back in April, NEOG stock took a nosedive when they initially cut guidance, blaming a softening macro. Given the whipsawing macro environment, I think many short-term-oriented hedge funds thought this was a great opportunity to bet on a NEOG earnings beat as tariffs got pulled off and market sentiment turned. The June 4 confirmation of weak guidance broke this trade and may have created a big unwind in some pods, which explains why, in theory, a non-event (reaffirming guidance from 2 months ago) drove the stock so aggressively. Personally, I took management at their word in April, so this has virtually no impact on my valuation.
The longer-term negative news is that there are some inventory write-downs in 4Q, and those will bleed into the next few quarters. From a cost perspective, who cares, but it shows continued operational sloppiness. Selling Genomics seems fine. I was already assuming the business shrinks to be insignificant by 2027. All-in-all, this looks like a technical sell off not a fundamental one. I ~doubled my position size.
Thank you. Would you mind sharing your position size at cost (I guess?) when you say "doubled my position size." ?
I won't comment on my exact portfolio sizing for a number of reasons, but will say this went from a small position to a medium one. I anticipate continued volatility will give me plenty of opportunity to continue sizing in over time. You should evaluate your own risk appetite and stomach for volatility as you think about sizing as this will likely be a very volatile battleground asset.
IMHO, doubled my position size, small to medium, etc - is useless unless you provide more context. Of course we do our own DD. That is besides the point. No worries. I understand.