Could Cash Machine Charles River Laboratories International Stock Be Your Next Buy?

Charles River Laboratories International (CRL) could be a good pick for your portfolio, with its high cash yield, good fundamentals, and discounted valuation. Companies like this can use cash to fuel additional revenue growth, or simply pay their shareholders through dividends or buybacks. Either move makes them attractive to the market

What Is Happening With CRL

CRL may be down -12% so far this year but is now trading at P/S (Price-to-Sales) ratio that is at a meaningful discount to its 3-month and 2-year highs, and also belowits 3-year average.

The stock may not reflect it yet, but here is what’s going well for the company. Charles River Laboratories exceeded Q3 2025 revenue and EPS forecasts, with biotech bookings improving monthly. Significant cost-saving measures, targeting $295 million by 2026, are underway. The non-human primate (NHP) supply chain has stabilized, and an SEC inquiry closed without action. While organic revenue saw a decline, growth in research models and strategic pricing position the company for future recovery as industry funding improves.

CRL Has Good Fundamentals

• Good Cash Yield: Not many stocks offer free cash flow yield of 6.8%, but Charles River Laboratories International stock does
• Strong Margin: Last 12 month operating margin of 8.8%
• Growth: Last 12 revenue growth of -0.9% – revenue decline, but this selection is all about high yield and margin
• Valuation: CRL stock currently trading at 41% below 2Y high, 18% below 1M high, and at a PS lower than 3Y average.

Below is a quick comparison of CRL fundamentals with S&P medians.

*LTM: Last Twelve Months

But What Is The Risk Involved?

While CRL stock may be a compelling investment opportunity, it’s always helpful to be aware of a stock’s history of drawdown. CRL took a hit of about 47% in the Dot-Com Bubble and nearly 70% during the Global Financial Crisis. The 2018 Correction was milder but still trimmed over 23%, and the Covid sell-off wiped out around 45%. The Inflation Shock in 2022 pushed CRL down more than 64%. Even solid companies like this aren’t immune when markets turn volatile. Drawdowns like these remind us that risk sticks around, no matter the fundamentals. But the risk is not limited to major market crashes. Stocks fall even when markets are good – think events like earnings, business updates, outlook changes. Read CRL Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.

For more details and our view, see Buy or Sell CRL Stock.

Stocks Like CRL

Not ready to act on CRL? Consider these alternatives:

1. PayPal (PYPL)
2. Global Payments (GPN)
3. Zimmer Biomet (ZBH)

We chose these stocks using the following criteria:

1. Greater than $2 Bil in market cap
2. Dipped last month & meaningfully below 2Y high
3. Current P/S < last few year average
4. Strong operating margin with no instances of large margin collapse
5. High free cash flow yield

A portfolio of stocks with the criteria above would have performed has follows since 12/31/2016:

• Average 6-month and 12-month forward returns of 10.4% and 20.4% respectively
• Win rate (percentage of picks returning positive) of about 74% for 12-month period
• Strategy consistent across market cycles

Multi Asset Portfolios Offer More Upside With Less Risk

Markets move differently but a mix of assets smooths volatility. A multi asset portfolio keeps you invested and reduces the impact of sharp drops in any single area.

The asset allocation framework of Trefis’ Boston-based, wealth management partner yielded positive returns during the 2008-09 period when the S&P lost more than 40%. Our partner’ strategy now includes Trefis High Quality Portfolio, which has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices