Zacks_Analysts' Blog : Qiagen Added in Russell 1000, 3000 - Analyst Blog

Recently, Qiagen (QGEN) announced that it has been included in the Russell 1000 and the Russell 3000 Indices. The Russell 1000 Index measures the performance of the large-cap segment of the U.S. equity universe and includes approximately 1,000 of the largest securities based on a combination of their market cap and current index. On the other hand, the Russell 3000 index evaluates the performance of the 3,000 largest U.S. companies by market capitalization. The constituents of the indices will remain in place for a year.

Qiagen is a leading provider of innovative technologies and products for pre-analytical sample preparation and molecular diagnostics solutions.  Over the years, the company  has developed a comprehensive portfolio of more than 500 proprietary, consumable products, and automated solutions for sample collection.  The company specializes in nucleic acid and protein handling, separation and purification.  The company also offers customized services such as whole genome amplification services, deoxyribonucleic acid (DNA) sequencing, and non-cGMP DNA production on a contract basis. 

The company has subsidiaries in the US, Germany, the UK, Switzerland, France, Japan, China, Australia, Canada, Norway, and several other countries with good sales potential. Qiagen has also established a presence in China with about 350 employees, thus making it the third-largest global market in terms of sales. In January this year, the company formed a new unit in India, which is touted as one of the world’s fastest-growing healthcare markets. The company derives the bulk of its revenue from Europe, the US, and Japan.

Qiagen primarily derives revenues from molecular diagnostics, applied testing, pharma and academia, which represented 44%, 6%, 21% and 29% of total sales, respectively, during the first quarter of fiscal 2011. Molecular diagnostics sales witnessed a 2% decline at CER as Profiling was affected by the crises in Japan and Egypt.

Moreover, Prevention was affected by soft HPV tests in the US. However, this dip in sales was partially offset by the upside in personalized healthcare based on the expansion of companion diagnostic sales in Europe and co-development projects with pharmaceutical companies.

However, given its solid cash position ($776 million at the end of first quarter) the company is adopting an aggressive acquisition strategy in order to widen its scope and attain a competitive edge over its peers like Life Technologies (LIFE) and Sigma-Aldrich (SIAL).

Earlier this month, the company entered into an agreement to acquire a 47% stake in France-based Ipsogen for €12.90 per share. Thereafter, Qiagen intends to make a public offer to fully acquire the company. With Ipsogen, Qiagen would have access to a wide portfolio of biomarkers targeted to patients suffering from blood cancer. Moreover in April 2011, Qiagen announced its plan of acquiring  Australia-based Cellestis Limited for $3.69 (A$3.55) per share in cash or $355 million (A$341 million).