A Look at Avantor's Valuation Following Earnings Miss, Net Loss, and Fraud Lawsuit

Avantor (NYSE:AVTR) is in the spotlight after revealing a hefty net loss in its latest earnings, driven by a sizable goodwill impairment, and facing a new securities fraud class action lawsuit. These issues have arisen within days of each other.

These events have weighed heavily on Avantor’s stock, amplifying investor concerns about the company’s operational transparency, future profitability, and ongoing legal risks.

See our latest analysis for Avantor.

Avantor’s recent turbulence has sent its share price tumbling nearly 29% over the last week alone, following lackluster earnings, guidance cuts, and a large goodwill write-down that hammered investor confidence. While management has announced new product launches and a sizeable buyback program, these positives have done little to shift sentiment. With the stock now down 47.9% year-to-date and the one-year total shareholder return standing at a sharp -50.6%, momentum is clearly fading despite efforts to spark a turnaround.

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With shares now trading at a significant discount to analyst price targets after the recent selloff, the key question for investors is whether Avantor has become undervalued or if the market has already priced in ongoing challenges and limited growth ahead.

Most Popular Narrative: 19.9% Undervalued

With Avantor closing at $11.05, the most widely tracked narrative sets a fair value at $13.80, suggesting a marked gap between market price and expectations. This narrative draws directly on forward-looking growth, profitability, and valuation forecasts from analysts, painting an intriguing picture of what could lie ahead for the stock.

The global growth in demand for biopharmaceuticals and healthcare solutions is being reinforced by Avantor's major contract wins and extensions with large pharma and biotech consortia. These contract wins position Avantor to capture greater market share as end-market funding and patient procedures return to normalized or higher levels. This creates sustained potential for above-market revenue growth.

Read the complete narrative.

Curious what math puts Avantor’s value nearly 20% above its current price? These analysts are betting on a business transformation and future profitability that could surprise. Want to see which levers drive this bold call? The pivotal projections and margin assumptions are hiding just beneath the surface.

Result: Fair Value of $13.80 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent bioprocessing setbacks or tougher competition could easily derail expectations for steady recovery. This could put renewed pressure on Avantor’s fragile turnaround hopes.

Find out about the key risks to this Avantor narrative.

Build Your Own Avantor Narrative

If you have your own perspective or want a hands-on look at the numbers, it takes just a few minutes to build your own take and Do it your way

A great starting point for your Avantor research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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