NEW YORK (TheStreet) -- Bio-Reference Labs (BRLI) shares are climbing 5% to $41.60 in early market trading on Monday despite missing analysts' earnings expectations after the company agreed to be acquired by Opko Health (OPK) for $1.47 billion.
Bio-Reference shareholders will receive 2.75 shares of Opko for every share of Bio-Reference they own as part of the all stock deal that is expected to be completed in the second half of this year.
However, today the company reported second quarter earnings of 38 cents per share, short of the 42 cents per share the company reported during the same period last year, and below analysts' consensus 43 cent per share guidance for this period.
Revenue for the quarter increased 11.2% year over year to $224 million, also missing analysts' consensus $227.33 million forecast.
"The company encountered less than satisfactory results from our California operation. Frankly, we did not grow commensurate with our investment and the changing reimbursement environment in that local market. We believe that the effect of increasing infrastructure expenses with lower than anticipated sales had a negative effect on earnings of $.05 per share. We are focused on improving our results as we take a thoughtful approach moving into the second half of the year," said CEO Marc D. Grodman, MD.
Opko Health shares are up 4.2% to $16.87 on heavy volume in early market trading today.
TheStreet Ratings team rates BIO REFERENCE LABS as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation: