Bio-Techne Corporation's price-to-earnings (or \"P/E\") ratio of 70x might make it look like a strong sell right now compared to the market in the United States, where around half of the companies have P/E ratios below 18x and even P/E's below 11x are quite common. Although, it's not wise to just take the P/E at face value as there may be an explanation why it's so lofty. While the market has experienced earnings growth lately, Bio-Techne's earnings have gone into reverse gear, which is not great. One possibility is that the P/E is high because investors think this poor earnings performance will turn the corner. You'd really hope so, otherwise you're paying a pretty hefty price for no particular reason. If you'd like to see what analysts are forecasting going forward, you should check out our . Is There Enough Growth For Bio-Techne? There's an inherent assumption that a company should far outperform the market for P/E ratios like Bio-Techne's to be considered reasonable. Taking a look back first, the company's earnings per share growth last year wasn't something to get excited about as it posted a disappointing decline of 35%. The last three years don't look nice either as the company has shrunk EPS by 42% in aggregate. So unfortunately, we have to acknowledge that the company has not done a great job of growing earnings over that time. Looking ahead now, EPS is anticipated to climb by 34% per annum during the coming three years according to the analysts following the company. That's shaping up to be materially higher than the 11% per annum growth forecast for the broader market. In light of this, it's understandable that Bio-Techne's P/E sits above the majority of other companies. Apparently shareholders aren't keen to offload something that is potentially eyeing a more prosperous future. The Key Takeaway Using the price-to-earnings ratio alone to determine if you should sell your stock isn't sensible, however it can be a practical guide to the company's future prospects. We've established that Bio-Techne maintains its high P/E on the strength of its forecast growth being higher than the wider market, as expected. Right now shareholders are comfortable with the P/E as they are quite confident future earnings aren't under threat. It's hard to see the share price falling strongly in the near future under these circumstances. You always need to take note of risks, for example - we think you should be aware of. If you're unsure about the strength of Bio-Techne's business, why not explore for some other companies you may have missed. ### Valuation is complex, but we're here to simplify it. Discover if Bio-Techne might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.

Investors Still Waiting For A Pull Back In Bio-Techne Corporation (NASDAQ:TECH)

The article analyzes Bio-Techne Corporation's high price-to-earnings (P/E) ratio of 70x, which is higher than most U.S. companies, but attributes it to expected earnings growth. Despite a 35% decline in earnings last year and a 42% cumulative decline over three years, analysts forecast 34% annual EPS growth, outpacing the broader market's 11% growth. Shareholders remain confident in the company's future, though risks are noted.