What Happened?
Shares of life sciences company Neogen (NASDAQ: NEOG) fell 5.4% in the afternoon session after the U.S. Food and Drug Administration issued warning letters to the company following laboratory tests that uncovered fungal contamination in its veterinary product HYCOAT.
The FDA said tests identified multiple fungal species in Neogen Vet HYCOAT, a product marketed as sterile. The contamination caused severe joint infections in nearly 100 horses and resulted in at least 20 horse deaths. The incident represents the highest number of horse fatalities ever linked to a quality issue in an FDA-regulated veterinary product.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Neogen? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Neogen’s shares are very volatile and have had 22 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 9 months ago when the stock gained 27.6% on the news that the company reported fourth-quarter results that far surpassed Wall Street's expectations and raised its financial forecast for the full year. The life sciences company posted adjusted earnings per share of $0.10, easily beating the analyst consensus of $0.07. Revenue for the quarter came in at $224.7 million, also topping the anticipated $209.7 million. Despite sales falling 2.8% year on year, investors were encouraged by the significant beats on both the top and bottom lines.
Looking ahead, Neogen raised its full-year revenue guidance to a midpoint of $850 million, ahead of Wall Street estimates. The company also increased its outlook for adjusted EBITDA to approximately $175 million, signaling confidence in its future performance.
Neogen is up 82.5% since the beginning of the year, and at $12.77 per share, it is trading close to its 52-week high of $13.98 from September 2026. Despite the year-to-date gain, investors who bought $1,000 worth of Neogen’s shares 5 years ago would now be looking at only $290.63.
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