Westbrook, Maine-based IDEXX Laboratories, Inc. (IDXX) is a global leader in veterinary diagnostics and animal-health technology, providing diagnostic instruments, rapid tests, laboratory services, and software primarily for companion animals, along with water-quality and livestock/dairy testing. Headquartered in Westbrook, Maine, and founded in 1983, the company operates in more than 170 countries and serves veterinarians, food-production facilities, and public health organizations. Companies worth $10 b ...

Core Insights - The Baron Asset Fund underperformed for the second consecutive quarter, declining 4.23% in Q3 2025, while the Index gained 2.78% [3] - The underperformance was primarily due to the Fund's underexposure to Momentum, Beta, and Residual Volatility factors, which led the market higher [3] - The Fund's overexposure to Earnings Quality negatively impacted performance as lower quality stocks rallied during the quarter [3] Sector Performance - Stock selection in IT and Communication Services accounted for about three-quarters of the underperformance, with significant declines from Gartner, Inc. and StubHub Holdings, Inc. [4] - Weakness in Consumer Discretionary was broad-based, with notable declines from Choice Hotels International, Inc. and On Holding AG [5] - Financials were hindered by FactSet Research Systems Inc. and Morningstar, Inc., affected by industry-wide concerns regarding AI and a shift in investor focus [7] - Health Care showed solid stock selection, driven by strong performance from IDEXX Laboratories, Inc. [8] Key Contributors - IDEXX Laboratories, Inc. contributed 1.13% to returns, benefiting from improved foot traffic and revenue growth in its Companion Animal segment [9] - Amphenol Corporation gained 1.01% as expectations for data center spending rose, bolstered by a significant acquisition [10] - SpaceX reported substantial growth in its Starlink service and continued advancements in rocket technology [11][12] Key Detractors - Gartner, Inc. detracted 2.31% from performance due to disappointing earnings and decelerating contract value growth [13] - StubHub Holdings, Inc. faced challenges post-IPO, with investments impacting near-term results [16] - Verisk Analytics, Inc. was affected by a conservative outlook and concerns about the property and casualty insurance market [17]

Core Insights - Baron Asset Fund's third-quarter 2025 performance was impacted by a decline of 4.23% in Institutional Shares, while the Russell Midcap Growth Index and Russell 3000 Index returned 2.78% and 8.18% respectively, primarily driven by expectations of Federal Reserve interest rate cuts [1] Company Performance - IDEXX Laboratories, Inc. (NASDAQ:IDXX) reported a one-month return of 11.86% and a 62.01% increase in share value over the last 52 weeks, closing at $708.45 with a market capitalization of $56.571 billion on November 7, 2025 [2] - The company achieved a 13% revenue increase, with 12% organic growth in the third quarter of 2025, supported by improved foot traffic to veterinary clinics and a 10% constant currency revenue growth in its core Companion Animal segment, marking its best result in two years [4] Strategic Initiatives - IDEXX Laboratories installed 2,400 inVue Dx cellular analyzers, exceeding investor expectations and indicating a positive outlook for future consumable revenue streams [3] - The company is actively repurchasing shares, reflecting management's confidence in sustained favorable market dynamics and long-term growth potential in pet ownership and care spending [3]

Core Insights - IDEXX Laboratories Inc. shares increased by 13% in intra-day trading following strong third-quarter results that exceeded analyst expectations, driven by the adoption of advanced diagnostic technologies [1] - The company reported adjusted earnings of $3.22 per share, surpassing analyst forecasts of $3.14, with revenue rising 13% year-over-year to $1.1 billion, exceeding consensus estimates of $1.07 billion [1] - Organic revenue growth for the period was recorded at 12% [1] Revenue Breakdown - The Companion Animal Group (CAG) segment led growth with a 14% increase in revenue [2] - CAG Diagnostics recurring revenue advanced 11% as reported and 10% organically, fueled by strong demand for IDEXX VetLab consumables, which grew 18% on a reported basis [2] - The company placed over 1,700 IDEXX inVue Dx analyzers during the quarter, resulting in a 74% increase in CAG Diagnostics capital instrument revenues [2] - Operating margin expanded by 100 basis points to 32.1% [2] Future Guidance - Following the strong results, the company raised its full-year 2025 guidance, now expecting revenue between $4.27 billion and $4.3 billion, indicating growth of 9.6% to 10.3% [3] - EPS guidance was also increased to a range of $12.81 to $13.01, above the consensus estimate of $12.63 [3]

Core Viewpoint - Idexx Laboratories reported strong quarterly results, exceeding Wall Street forecasts, and raised its 2025 outlook, leading to a significant increase in its stock price [1][2]. Financial Performance - In Q3, Idexx's sales increased by 13% to $1.11 billion, surpassing the expected $1.07 billion [2]. - The company earned an adjusted $3.22 per share, exceeding projections of $3.12, with earnings growing by 15% [2]. Stock Performance - Idexx's stock surged over 16% to reach a record high of 725.82, breaking out of a flat base with a buy point at 688.12 [3]. Market Trends - The quarter saw a slight decline in total vet visits by 2.4%, but sales of pet products grew organically by 12%, and revenue from the livestock, poultry, and dairy unit increased by 14% [4]. - The U.S. companion animal business performed well, with international companion animal group (CAG) business growing at 15.5% organic constant currency, the fastest rate since the pandemic [5]. Product Development - Idexx is in a new product cycle with Cancer Dx and InVue Dx, which may help mitigate the impact of slow vet visits on its shares [6]. - The guidance hike reflects higher expectations for InVue Dx, a new cellular analyzer [4]. Analyst Insights - Analysts view the quarterly results as a strong indicator of Idexx's operational execution and potential for future growth [5]. - The ongoing demand for pet care, driven by the 2020 puppy boom and increased spending by younger generations, supports a bullish outlook for Idexx and similar companies [8].

Financial Data and Key Metrics Changes - IDEXX reported a revenue increase of 13% as reported and 12% organically, with CAG Diagnostics' recurring revenues growing over 10% organically [4][5] - Earnings per share (EPS) for Q3 was $3.40, reflecting a 15% growth on a comparable basis [5][12] - The company increased its full-year revenue outlook to a range of $4,270 million to $4,300 million, representing an overall reported revenue growth of 9.6% to 10.3% [5][14] Business Line Data and Key Metrics Changes - CAG Diagnostics' recurring revenue growth was negatively impacted by a 1.2% decline in U.S. same-store clinical visits [4][6] - IDEXX VetLab Consumables revenues increased 16% organically, supported by the expansion of the premium instrument install base [9] - Global Rapid Assay revenues declined 5% organically due to a shift in testing to the Catalyst platform [10] Market Data and Key Metrics Changes - U.S. organic CAG Diagnostics' recurring revenues grew 8% in Q3, while international CAG Diagnostics' recurring revenue grew 14% organically [6][8] - Water revenues increased 7% organically, with strong growth in international regions [11] - Livestock, poultry, and dairy revenues increased 14% organically, with double-digit gains across most regions [11] Company Strategy and Development Direction - IDEXX aims to expand its CancerDx franchise in 2026, adding mass cell tumor detection and another high-impact cancer biomarker [19][29] - The company is focused on enhancing its commercial footprint in international markets, with plans to expand in three countries by early 2026 [22] - IDEXX's strategy includes continuous investment in innovation and commercial capabilities to drive growth and improve customer engagement [20][42] Management's Comments on Operating Environment and Future Outlook - Management noted that diagnostics remains the fastest-growing revenue stream within veterinary clinics, driven by increased testing frequency and utilization [18] - The company expects to see continued growth in clinical visits as the pet population ages, particularly among dogs and cats [51] - Management highlighted the importance of maintaining high customer retention levels and the ongoing demand for IDEXX's innovative solutions [20] Other Important Information - Free cash flow for Q3 was $371 million, with a net income to free cash flow conversion rate of 94% [12] - The company allocated $242 million for share repurchases during Q3, contributing to a 2.7% year-over-year reduction in diluted shares outstanding [14] Q&A Session Summary Question: Strength of consumables in the quarter - Management indicated that growth in VetLab consumables is broad-based, driven by a large install base and high-quality placements [33] Question: MU consumables and new contracting terms - The growth in consumables is attributed to the high-quality placements and the introduction of new tests that veterinarians prefer to perform at the point of care [34] Question: MU placements and backlog of customers - Management confirmed that they are on track with MU placements and expect most customers to utilize multiple testing use cases [35] Question: End market visit trends - Management noted that non-wellness visits were closer to flat in Q3, with pressures on wellness visits continuing [38] Question: International CAG diagnostic recurring revenue growth - Management highlighted that international markets are still developing, with significant opportunities for growth as the sales organization matures [49]

Core Insights - Global Innovative Platforms Inc. has completed the first phase of research into a non-invasive breath-based diagnostic for detecting heartworm disease in dogs, aiming to identify infections earlier than the current standard of six months [1][2] - The company plans to develop a point-of-care diagnostic tool that could allow veterinarians to intervene sooner, potentially improving the health and longevity of dogs [2][4] - The research team, led by Dr. Lindsay Starkey, is optimistic about the initial data and is committed to further exploring breath analysis for effective heartworm detection [3][4] Company Overview - Global Innovative Platforms Inc. focuses on advancing animal health through non-invasive breath analysis and air quality technology, with a division dedicated to developing diagnostic tools for disease detection and monitoring [5] - The company is exploring the potential of breath analysis to detect multiple conditions through a single test, which could revolutionize veterinary diagnostics [4]

Core Insights - Fundsmith LLP, led by Terry Smith, reported a portfolio valued at $23.02 billion, with the top five holdings comprising 43.49% of total assets [1] Group 1: Top Holdings - Meta Platforms Inc. (META) is the largest holding, with 3.57 million shares valued at $2.63 billion, representing 11.44% of the portfolio, despite a reduction of 315,000 shares (-8.11%) [2] - Microsoft Corp. (MSFT) is the second-largest position, holding 4.94 million shares worth $2.46 billion, accounting for 10.68% of assets, with a modest cut of 428,653 shares (-7.98%) [3] - Stryker Corp. (SYK) holds 4.68 million shares valued at $1.85 billion, making up 8.04% of the portfolio, with a reduction of 392,000 shares (-7.74%) [4] - Philip Morris International (PM) consists of 9.07 million shares valued at $1.65 billion, representing 7.18% of the portfolio, despite trimming 1.73 million shares (-16.03%) [5] - IDEXX Laboratories (IDXX) rounds out the top five with 2.64 million shares valued at $1.42 billion, accounting for 6.15% of the portfolio, with a minor reduction of 9,042 shares (-0.34%) [6] Group 2: Investment Strategy - Fundsmith's strategy emphasizes a concentrated portfolio of high-quality companies with durable advantages, focusing on technology, healthcare, and consumer franchises [7] - The fund's approach reflects a commitment to quality growth at sensible valuations, reinforcing its reputation for consistency and long-term focus [7]

Core Insights - Zomedica Corp. has strengthened its intellectual property portfolio with the issuance of four additional U.S. patents for its TRUVIEW and TRUFORMA diagnostic platforms [1] - The veterinary diagnostics market is currently valued between $8 billion and $11 billion and is projected to grow to $17 billion to $22 billion by 2030-2032, with a compound annual growth rate (CAGR) of 9-11% [1] Company Summary - Zomedica now holds a total of 228 patents and 153 trademarks, providing robust protection for its product platforms [1] - The company focuses on innovative point-of-care diagnostic and therapeutic device products for equine and companion animals [1]

Summary of IDEXX Laboratories (IDXX) 2025 Investor Day Company Overview - IDEXX Laboratories is focused on the pet health care industry, emphasizing innovation and customer-centric solutions to enhance veterinary diagnostics and care [1][2][8][89]. Key Industry Insights - The pet population in the U.S. has increased by 12% from 2020 to 2022, leading to a rise in demand for veterinary services as pets age and require more health care [92][94]. - Average lifespans of pets have increased by nearly two years since 2020, resulting in a 22% increase in diagnostic spending over a pet's lifetime [96]. - There is a significant opportunity in feline health care, as only 30% of cats visited a veterinarian last year compared to 70% of dogs, indicating a need for improved care and diagnostics for cats [97][98]. Core Business Strategies - IDEXX's business model is built on a durable recurring revenue stream, with over 80% of total revenue coming from diagnostics and related services [10][88]. - The company is committed to innovation across various dimensions, including point of care, reference lab services, and customer-facing software [8][21]. - IDEXX aims to increase diagnostics utilization through education and partnerships with veterinary practices, focusing on best practices and standards [15][16][20]. Financial Performance and Growth Opportunities - The company sees a long-term growth opportunity exceeding $45 billion, with a projected growth rate of over 10% [7][86][88]. - IDEXX's investment in R&D is substantial, with a focus on developing integrated solutions that address both clinical and business challenges faced by veterinarians [22][23][24]. Innovations and Product Development - IDEXX has introduced new diagnostic tests, including canine lymphoma and mast cell tumor detection, which are expected to enhance the diagnostic capabilities of veterinary practices [34][39][40]. - The company is expanding its cancer diagnostics panel and aims to include additional tests by 2026, addressing a significant market need [39][42]. Customer Engagement and Software Solutions - IDEXX is developing a vertical SaaS technology stack tailored for animal health, which integrates various applications to optimize veterinary workflows [64][68]. - The company emphasizes the importance of customer relationships and frequent engagement to drive diagnostics usage and improve practice performance [70][72]. Market Trends and Future Outlook - The aging pet population and rising expectations for pet care are expected to drive demand for diagnostics and veterinary services [100][101]. - IDEXX is well-positioned to capitalize on these trends by providing innovative solutions and supporting veterinary practices in meeting the evolving needs of pet owners [86][88]. Conclusion - IDEXX Laboratories is strategically positioned to leverage significant growth opportunities in the pet health care sector through innovation, customer engagement, and a strong focus on diagnostics [88][89].