Biopharma manufacturing company Repligen Corporation (NASDAQ: RGEN) announced better-than-expected revenue in Q3 CY2025, with sales up 21.9% year on year to $188.8 million. The company’s full-year revenue guidance of $733 million at the midpoint came in 0.8% above analysts’ estimates. Its non-GAAP profit of $0.46 per share was 10.6% above analysts’ consensus estimates.

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Company Overview

With over 13 strategic acquisitions since 2012 to build its comprehensive bioprocessing portfolio, Repligen (NASDAQ: RGEN) develops and manufactures specialized technologies that improve the efficiency and flexibility of biological drug manufacturing processes.

Revenue Growth

Examining a company’s long-term performance can provide clues about its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Luckily, Repligen’s sales grew at an impressive 16.7% compounded annual growth rate over the last five years. Its growth beat the average healthcare company and shows its offerings resonate with customers.

We at StockStory place the most emphasis on long-term growth, but within healthcare, a half-decade historical view may miss recent innovations or disruptive industry trends. Repligen’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 4.2% over the last two years was well below its five-year trend.

We can better understand the company’s sales dynamics by analyzing its organic revenue, which strips out one-time events like acquisitions and currency fluctuations that don’t accurately reflect its fundamentals. Over the last two years, Repligen’s organic revenue averaged 2.5% year-on-year growth. Because this number is lower than its two-year revenue growth, we can see that some mixture of acquisitions and foreign exchange rates boosted its headline results.

This quarter, Repligen reported robust year-on-year revenue growth of 21.9%, and its $188.8 million of revenue topped Wall Street estimates by 3.8%.

Looking ahead, sell-side analysts expect revenue to grow 12.6% over the next 12 months, an improvement versus the last two years. This projection is noteworthy and suggests its newer products and services will fuel better top-line performance.

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Adjusted Operating Margin

Adjusted operating margin is one of the best measures of profitability because it tells us how much money a company takes home after subtracting all core expenses, like marketing and R&D. It also removes various one-time costs to paint a better picture of normalized profits.

Repligen has been an efficient company over the last five years. It was one of the more profitable businesses in the healthcare sector, boasting an average adjusted operating margin of 21.2%.

Looking at the trend in its profitability, Repligen’s adjusted operating margin decreased by 17.8 percentage points over the last five years. The company’s two-year trajectory also shows it failed to get its profitability back to the peak as its margin fell by 1.5 percentage points. This performance was poor no matter how you look at it - it shows its expenses were rising and it couldn’t pass those costs onto its customers.

In Q3, Repligen generated an adjusted operating margin profit margin of 14.2%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Repligen’s EPS grew at an unimpressive 4.4% compounded annual growth rate over the last five years, lower than its 16.7% annualized revenue growth. This tells us the company became less profitable on a per-share basis as it expanded.

Diving into the nuances of Repligen’s earnings can give us a better understanding of its performance. As we mentioned earlier, Repligen’s adjusted operating margin was flat this quarter but declined by 17.8 percentage points over the last five years. Its share count also grew by 5.7%, meaning the company not only became less efficient with its operating expenses but also diluted its shareholders.

In Q3, Repligen reported adjusted EPS of $0.46, up from $0.43 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Repligen’s full-year EPS of $1.67 to grow 22.6%.

Key Takeaways from Repligen’s Q3 Results

We enjoyed seeing Repligen beat analysts’ organic revenue expectations this quarter. We were also glad its revenue outperformed Wall Street’s estimates. On the other hand, its full-year EPS guidance slightly missed and its full-year operating income guidance fell short of Wall Street’s estimates. Overall, this print was mixed but still had some key positives. The stock traded up 3.1% to $165.82 immediately after reporting.

Sure, Repligen had a solid quarter, but if we look at the bigger picture, is this stock a buy? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.