Global equity markets soared on the final trading day of June, as EU officials agreed on a €120 billion ($150 billion) bailout fund to support growth measures. The Dow Jones Industrial Average, S&P 500 and NASDAQ jumped 2.2%, 2.5% and 3.0%, respectively, that day. As part of the proposal, funding will be made directly available to struggling banks to help lower borrowing costs without expanding government debt. The impact of the Eurozone debt crises has also provoked further monetary easing in China, which already reduced its economic growth targets for 2012. Meanwhile, the US encountered higher initial jobless claims, lower consumer sentiment and sluggish manufacturing data in June. Despite lower returns for most US Indexes in the second quarter, the Dow, S&P 500 and NASDAQ ended the month up 3.9%, 4.0% and 3.8%, respectively. For the first half of the year, the Dow, S&P 500 and NASDAQ are up 5.4%, 8.3%, and 12.7%, respectively.

In June, three IBO Stock Indexes advanced, but the Diversified Instrumentation Stock Index declined 2.4%. The Lab Consumables/Equipment, Process/Metrology/Motion Instrumentation and Laboratory Instrumentation Stock Indexes improved 5.2%, 4.7% and 2.0%, respectively.

Laboratory Instrumentation Stock Index

For the month, the Laboratory Instrumentation Index increased 2.0% to close at 605.89. Eleven companies traded higher and seven declined, led by Bruker, which fell 10%. Pressure BioSciences recorded the largest price increase for the month, climbing 33%, but was down 33% for the year. For the first half of the year, the Index is up 7.2%, with 12 companies in positive territory and six with negative returns. Illumina has advanced the most, having gained 33%.

Roche’s CEO confirmed in an interview on June 10 that the company would not make another offer to purchase Illumina (see IBO 6/15/12). Shares of Illumina declined 1.8% the next day. On June 19, prior to the completed acquisition of eBioscience (see page 2), Affymetrix priced a $105 million unsecured convertible senior notes offering due 2019 at a conversion price of roughly $5.88 per share. Shares fell 12.6%. Sequenom rose 6.2% on June 26 following positive comments by William Blair, suggesting that Sequenom could accession more than 25,000 tests in the third quarter.

The S&P Indices announced on June 7 that Luminex would be added to the S&P SmallCap 600 Index effective June 12. Luminex climbed 6.2% the next day. On June 18, Pacific Biosciences launched a new software solution to detect DNA-base modifications (see page 9). Shares jumped 10.1%. On June 18, the international drug purchase facility UNITAID approved $30 million in funding million to increase access to Cepheid’s Xpert MTB/RIF diagnostic test for tuberculosis in developing countries. Cepheid shares rose 3.1%.

Maxim Group initiated coverage of Sequenom on June 19 with a “Buy” rating. On June 26, Cantor Fitzgerald initiated coverage of Fluidigm and Accelrys each with a “Buy” rating and $17.00 and $10.00 price targets, respectively. Earlier in the month, on June 15, Northland Securities upgraded Accelrys from “Market Perform” to “Outperform” and raised the price target from $9.00 to $10.00.

Process/Metrology/Motion Instrumentation Stock Index

The Process/Metrology/Motion Instrumentation Index advanced 4.7% in June to 542.80. Three companies posted higher returns, and four contracted. MKS Instruments led the Index, rising 10%. Year to date, the Index has gained 10.9%, with four companies improving and three in negative territory. Veeco Instruments has gained the most, climbing 65%. SDIX has fallen 27% and 35% for the month and year, respectively.

FEI announced on June 7 its first cash quarterly dividend of $0.08, sending shares up 2.5%. On June 26, Stifel Nicolaus upgraded Veeco from “Hold” to “Buy,” with a $48.00 price target.

Lab Consumables/Equipment Stock Index

The Laboratory Consumables/Equipment Stock Index grew 5.2% in June to 629.97. For both the month and year, five companies have finished higher and two have declined. Kewaunee Scientific has gained the most value for both the month and year, climbing 39% and 40%, respectively, while Enzo Biochem has declined 8% and 25%, respectively.

Three companies in the Index reported earnings this month. On June 6, Pall missed EPS estimates by a wide margin due to order delays. The company lowered its fiscal full-year EPS target by 3% to $3.10, with EPS of $2.72 from continuing operations. Shares fell 4.3% the next day. Enzo Biochem missed fiscal third-quarter EPS estimates on June 11 as a result of higher R&D expenses. Shares traded marginally lower the next day. On June 26, Kewaunee Scientific reported strong EPS growth for the fiscal fourth quarter due to lower cost of goods sold. However, fiscal full-year EPS fell 44% to $0.40 due to lower pricing and higher raw materials costs.

JPMorgan upgraded Pall on June 8 to “Neutral” from “Underweight” and raised its price target to $55 from $53. On the same day, William Blair initiated coverage of Techne with a “Market Perform” rating. On June 15, Cleveland Research set an initial “Neutral” rating on Sigma-Aldrich.

Diversified Instrumentation Stock Index

The Diversified Instrumentation Stock Index contracted 2.4% in June to 141.82. Five companies declined, and two advanced. Illinois Tool Works declined the most, falling 6%, while Teledyne Technologies improved 3%. The first half of the year ended with the Index up 11.9% and all seven companies trading higher. AMETEK boasts the largest return year to date, having gained 19%.

Agilent completed the acquisition of Dako (see IBO 5/31/12) on June 21. Shares fell 3.7%. Drexel Hamilton upgraded Teledyne Technologies on June 6 from “Hold” to “Buy.” Janney Montgomery Scott upgraded Mettler-Toledo on June 7 from “Neutral” to “Buy.” On June 15, Citigroup initiated coverage of Agilent Technologies with a “Buy” recommendation and a $46.00 price target.

International

For the month and year, all six Pacific Region companies are trading higher. Hitachi High-Technologies had the highest return for the month, gaining 12%. Year to date, HORIBA has the largest price increase, having risen 20%.

In June, seven European companies traded higher, five declined and one was unchanged. Halma improved the most, gaining 7%. Alpha MOS has sustained the sharpest declines for the month and year, falling 20% and 47%, respectively. At the end of the second quarter, nine European companies are in positive territory, three have contracted and one is flat. Sartorius has experienced the largest price increase, gaining 55%.

On June 12, Oxford Instruments announced full-year adjusted EPS growth ending March 31 of 49.3% to £0.60 ($0.96), yet shares fell 4.9%. On June 14, Halma reported EPS growth of 19.4% for the same fiscal year to £0.24 ($0.39). The company raised its dividend by 7% to £0.10 ($0.15) for the year. Shares slipped 0.8%. On June 29, Alpha MOS reported a 17.8% decline in sales to €4.1 million ($5.5 million) and more than doubled its net loss to €0.9 million ($1.3 million) for the six months ending March 31. Revenue growth was negatively impacted by slower demand in Europe and Japan. Shares fell 7.0%.

In other news, on June 6, Sartorius announced that it will be added to TecDAX, the German index of technology stocks, effective June 18. Shares increased 4.1%. On June 27, Exiqon completed a registration for 1.8 million shares, or roughly 5% of its outstanding shares. The company expects gross proceeds of approximately DKK 15 million ($2.5 million). Shares were unchanged.

 Line Graph: IBO Instrument Industry Stock Index
  Lab Instrument Stock Index S&P 500
 Jun-10 531.11    247.12
 Jul-10 513.20    264.12
 Aug-10 499.94    251.58
 Sep-10 556.95    273.61
 Oct-10 579.40    283.69
 Nov-10 589.00    283.04
 Dec-10 565.27    301.52
 Jan-11 657.02    308.36
 Feb-11 661.02    317.14
 Mar-11 661.90    317.88
 Apr-11 703.32    326.93
 May-11 721.22    322.52
 Jun-11 712.55    316.63
 Jul-11 676.63    309.83
 Aug-11 635.47    292.24
 Sep-11 577.75    271.27
 Oct-11 602.13    300.49
 Nov-11 569.85    298.97
 Dec-11 565.27    301.52
 Jan-12 628.98    314.66
 Feb-12 634.89    327.43
 Mar-12 644.38    337.69
 Apr-12 637.19    335.16
 May-12 593.81    314.16
 Jun-12 605.89    326.59
 

                    2012                           2011
 Cos.  Date    FQ   Adj.   Con-      Vs.     Grw.   Adj. 
      Rept.        EPS    sensus    Est.           EPS 
 Lab Consumables/Equipment    
 ENZ   11-Jun  3Q  ($0.09) ($0.07)  -$0.02  -80%  ($0.05)
 KEQU  26-Jun  4Q  $0.49    NA       NA     390%   $0.10 
 PLL   6-Jun   3Q  $0.61    $0.79   -$0.18  -15%   $0.72 
 

                      Market      52 Week     Price      Change     Change          EPS    EPS   LTD/     FY       R&D/
                      Value
 Company:Exchange   (US $000s)   Low    High   #####     1 Month     YTD    P/E     12     FY    Equity   ROE     Sales
                                                                                   Month
 Laboratory Instrumentation            
 Accelrys:o         $457,182    5.68  8.45    $8.09       4%         20%    NM    -0.38   -0.44   17%      1%       24%
 Affymetrix:o       $328,192    3.68  8.16    $4.69      -1%         15%    NM    -0.46   -0.40    5%      NM       24%
 Becton, Dickinson  $15,682,774 69.59 89.75   $74.75      2%         0%     14     5.44    5.59   114%    26%       6%
 and Company: n
 Bio-Rad Labor-:n   $2,855,586 84.02 122.39 $100.01      0%          4%     16     6.19    6.26    49%    10%       9%
 atories
 Bruker: o          $2,221,439  11.48 21.30  $13.31     -10%         7%     23     0.57    0.55    55%    15%      11%
 Cepheid: o         $2,903,456  29.71 45.19  $44.65      18%        30%     NM    -0.05    0.04     2%     1%      21%
 Fluidigm: o        $306,726    11.64 20.20  $15.04      8%         14%     NM    -0.54    -1.81    2%     NM      33%
 Harvard Bioscience:o $111,867  3.45  6.04   $3.77       5%         -3%     42     0.09     0.13   23%     4%       5%
 Illumina: o        $5,406,565  25.57 79.40  $40.39     -6%         33%     61     0.66     0.62   73%     8%      19%
 Luminex: o         $1,002,106  18.33 25.79  $24.49     11%         15%     79     0.31     0.34    4%     6%      18%
 MOCON: o           $87,657     12.20 20.40  $15.40     -1%         -4%     18     0.88     0.98    9%    16%       6%
 Pacific Biosciences: $119,786  1.76  12.38  $2.17      -8%        -23%     NM    -1.87    -2.03    4%     NM     225%
 PerkinElmer: n    $2,944,270   17.45 28.24  $25.80     -3%         29%     645    0.04     0.06   73%     0%      6%
 Pressure BioSciences:$3,085    0.20  1.15   $0.40      33%        -33%     NM    -0.57    -0.77   -1%     NM     98%
 Sequenom: o       $448,679     3.46  8.01   $4.06       6%         -9%     NM    -0.84    -0.75   13%     NM     96%
 Thermo Fisher     $19,211,891  43.06 65.68  $51.91      3%         15%     15     3.57     3.46   57%     9%      3%
 Scientific: n 
 Transgenomic: o   $56,415      0.70  1.85   $0.90       7%        -30%     NM    -0.03    -0.04   22%    NM       7%
 Waters: n         $7,173,677  70.88  99.37  $79.47      0%          7%     17     4.66     4.69   70%    35%      5%
 Process/Metrology/Motion Instrumentation           
 FEI Company: o    $1,986,221  26.61  52.01  $47.84      5%         17%     18     2.60     2.51   18%    15%      9%
 MKS Instruments: o$1,535,987  20.01  34.99  $28.86     10%          4%     13     2.15     2.45   3%     13%      7%
 MTS Systems: o    $610,324    28.00  54.82  $38.55      0%         -5%     12     3.31     3.24   9%     24%      3%
 Nanometrics: o    $368,348    13.49  21.56  $15.36     -1%        -17%     18     0.84     1.22   8%     14%      10%
 SDIX: o           $24,586     0.95   2.44   $1.20      -27%       -35%     NM    -0.04    -0.01   NM     NM       15%
 Veeco Instruments: $1,335,333 20.35  49.78  $34.36     -1%         65%     15     2.29     3.11   1%     17%      10%
 Zygo: o           $337,250    9.40   20.44  $17.86     8%           1%     14     1.30     1.05   2%     15%      10%
 Lab Consumables/Equipment            
 Enzo Biochem: n   $64,838     1.65   4.88   $1.67      -8%        -25%     NM    -0.42    -0.34   0%     NM       8%
 Kewaunee Scientific: $29,489  7.90   11.68  $11.43     39%         40%     29     0.40     0.40   39%    3%       1%
 Life Technologies: $8,238,254 35.30  52.61  $44.99     10%         16%     20     2.21     1.99   59%    8%      10%
 Pall: n            $6,487,202 39.81  64.55  $54.81     -2%         -4%     20     2.81     2.67   55%    21%      3%
 QIAGEN: o          $3,989,380 12.47  19.75  $16.70      4%         21%     42     0.40     0.40   27%    4%      11%
 Sigma-Aldrich: o   $9,019,460 56.18  76.16  $73.93      7%         18%     20     3.71     3.72   25%    21%      3%
 Techne: o          $2,740,206 62.04  86.43  $74.20      9%          9%     24     3.06     3.02    1%    19%      9%
 Diversified Instrumentation            
 Agilent          $13,890,960  28.67  52.62  $39.24     -3%         12%     13     3.11     2.85   60%    23%     10%
 Technologies:n
 AMETEK: n        $8,095,652   30.87  52.81  $49.91     -2%         19%     20     2.49     2.37   76%    19%      3%
 Danaher: n       $37,186,318  39.34  56.45  $52.08      0%         11%     16     3.34     3.11   48%    11%      6%
 Illinois Tool    $25,247,348  39.12  59.27  $52.89     -6%         13%     13     3.95     4.19   50%    21%      1%
 Works: n
 Mettler-Toledo  $5,047,502    126.10 190.02 $155.85     0%         6%      19     8.42     8.21   97%    35%      5%
 Int’l: n
 Roper Industries: n $9,789,684 64.90 103.50 $98.58     -3%        13%      22     4.52     4.34   47%    13%      4%
 Teledyne Techno- $2,293,380    44.86 66.29  $61.65      3%        12%      9      6.94     6.84   53%    15%      5%
 logies
 Laboratory Instrumentation Stock Index      605.89     2.0%      7.2%      18                     65%    11%      7%
 Process/Metrology/Motion Instrumentation    542.80     4.7%      10.9%     15                      7%    15%      8%
 Lab Consumables/Equipment Stock Index       629.97     5.2%      10.6%     22                     42%    12%      7%
 Diversified Instrumentation Stock Index     141.82    -2.4%      11.9%     16                     53%    16%      5%
 Dow Jones Industrial Average              12,880.09    3.9%       5.4%      
 S&P 500                                   1,362.16     4.0%       8.3%      
 NASDAQ Composite                          2,935.05     3.8%      12.7%      
                                                           Price         
 Region                       Market        Market         #####     Change   Change        EPS    EPS    LTD/   FY   R&D/
                              Value           Value
 Company                     (US $000s)     (Local 000s)    (Local)   1 Month  YTD    P/E   12     FY     Equity ROE  Sales
                                                                                           Month
 Pacific Shares             
 Hitachi High-Technologies: t $3,380,627  ¥268,866,001     ¥1,952      12%     17%   19   ¥103.71  ¥103.71  11%   6%    3%
 HORIBA: t                    $1,478,356  ¥117,575,747     ¥2,780       6%     20%   14   ¥204.00  ¥204.41  16%   8%    9%
 JEOL: t                      $197,587    ¥15,714,389      ¥198        12%      3%   296  ¥0.67    ¥0.67   100%   0%    6%
 Precision System Science: os $34,998     ¥2,783,430       ¥30,500     4%      5%    NM  -¥3,272  -¥4,018   41%   NM   14%
 Shimadzu: t                  $2,547,289  ¥202,589,435     ¥685        5%      5%    22   ¥30.79   ¥30.79   19%   5%    3%
 Techcomp: hk                 $82,728   HKD 641,700.00   HKD 2.76     10%     12%    73   $0.04     $0.04    7%   13%   1%
 European Shares             
 Abcam: I                     $1,194,185  £765,265         £4.17      6%       14%   30   £0.14     £0.13    1%   32%   4%
 Halma: l                     $2,459,838  £1,576,328       £4.18      7%       26%   18   £0.23     £0.23    35%  22%   5%
 Oxford Instruments: l        $1,055,009  £676,077         £12.27     6%       29%   27   £0.45     £0.45    35%  20%   8%
 Renishaw: l                  $1,590,197  £1,019,040       £14.00    -2%       39%   16   £0.87     £0.91    37%  30%  10%
 Scientific Digital Imaging:l $2,768      £1,774           £0.10      5%        0%   8    £0.01     £0.01    0%   NM    5%
 Spectris: l                  $27,794     £1,781,103       £15.32    -5%       19%   14   £1.07     £1.07    75%  21%   7%
 Alpha MOS: c                 $5,851     € 4,647          € 1.19     -20%     -47%   NM  -€ 0.05   -€ 0.14   16%  NM    13%
 Analytik Jena: g             $73,289    € 58,212         € 10.90     2%       2%   61   € 0.18    -€ 0.03   47%  NM    15%
 Sartorius: g                 $1,105,362 € 877,968        € 46.90     0%       55%  18   € 2.55     € 2.44   107% 11%   6%
 Tecan: s                     $782,322  CHF 747,525      CHF 65.5     4%       3%   15   CHF 4.36   CHF 4.36  5%  18%   12%
 Datacolor: s                 $59,732   CHF 57,075       CHF 374.0    0%       -5%   19  CHF 20.07  CHF 21.48 7%   0%   12%
 Biotage: st                  $823      SEK 5,734        SEK 7.2      0%       38%   11  SEK 0.66   SEK 0.46  6%   6%   8%
 Exiqon:  no                  $58,707   DKK 346,616      DKK 9.4      1%       -2%   NM  -DKK 0.78 -DKK 0.71  2%   NM   21%