Neogen Corporation (NEOG): A Bull Case Theory

We came across a bullish thesis on Neogen Corporation on Cornerstone Value’s Substack. In this article, we will summarize the bulls’ thesis on NEOG. Neogen Corporation’s share was trading at $5.60 as of August 25^th. NEOG’s trailing and forward P/E were 822.50 and 16.00 respectively according to Yahoo Finance.

On July 29th, NEOG reported its fourth-quarter and full-year results, which disappointed investors and led to a ~10.5% stock decline. While revenue, earnings, and NTM figures aligned with expectations, management highlighted ongoing challenges in the Petrifilm and Sample Collection businesses, revealing revenue declines and production inefficiencies that surprised the market. Sample Collection saw sequential improvement, yet sales remain below last year due to difficulties sustaining automated production uptime, creating margin headwinds.

Petrifilm faced year-on-year sales declines, partly driven by lapping ERP-related shipping delays that had previously inflated sales. Management’s prior communications regarding growth and performance contributed to investor frustration, underscoring executional issues amid leadership transitions. The absence of a COO and the outgoing CEO John Adent’s limited engagement over the past year exacerbated operational shortcomings, though the Board has initiated a leadership refresh, appointing Mike Nassif as CEO starting in August.

Nassif, with a background in business transformations and turnarounds, is expected to stabilize the executive team and provide clarity on multi-year strategy. Investors anticipate a full investor day and refreshed guidance, which could act as a catalyst. Despite near-term headwinds from macro factors, tariffs, and Animal Safety market pressures, the long-term fundamentals of Petrifilm as a differentiated product and NEOG’s underlying growth story remain intact. Operational issues are seen as temporary, and performance should improve over the next two to four quarters under new leadership. While NEOG remains a top holding for long-term investors, caution is warranted as volatility persists, and the market will closely monitor Petrifilm and Sample Collection performance as key indicators of the company’s secular growth trajectory.

Previously we covered a bullish thesis on Fulcrum Therapeutics, Inc. (FULC) by Stock Pursuit in May 2025, which highlighted Pociredir’s potential for treating Sickle Cell Disease, early clinical success, and a strong cash runway into 2027. The company’s stock price has depreciated approximately by 0.46% since our coverage. Cornerstone Value shares a similar focus on long-term growth but emphasizes operational execution and leadership changes at Neogen Corporation (NEOG) as the near-term catalyst.

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Disclosure: None.