Phibro Animal Health’s latest quarter drew a modestly negative market reaction, despite revenue exceeding Wall Street expectations. Management highlighted that significant growth came from its non-animal health segments, with Performance Products and Mineral Nutrition expanding at double-digit rates. CEO Dani Bendheim acknowledged that animal health sales were softer than other segments, citing temporary demand pressures in poultry vaccines and nutritional specialties. Bendheim also noted that producer margins in protein markets tightened, leading some customers to trim spending and inventories. The company saw operating margin decline compared to the prior year, reflecting higher operating expenses and segment mix.
Is now the time to buy PAHC? Find out in our full research report (it’s free for active Edge members).
Phibro Animal Health (PAHC) Q3 CY2026 highlights:
- Revenue $386.8 million vs S&P analysts’ estimates of $375.4 million (6.3% year-on-year growth, 3% beat)
- Adjusted EPS $0.79 vs S&P analysts’ estimates of $0.78 (in line)
- Adjusted EBITDA $64.3 million (16.6% margin, 3.9% year-on-year growth)
- Revenue guidance The company reconfirmed its revenue guidance for the full year of $1.58 billion at the midpoint
- Adjusted EPS guidance Management reiterated its full-year adjusted EPS guidance of $3.50 at the midpoint
- EBITDA guidance $263 million at the midpoint for the full year, above analyst estimates of $259.6 million
- Operating margin 12.8%, down from 14.1% in the same quarter last year
- Market capitalization $1.44 billion
While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our top 5 analyst questions from Phibro Animal Health’s Q3 earnings call
- Ekaterina Knyazkova (JPMorgan) asked about the outlook for virginiamycin in Brazil. CEO Dani Bendheim replied that no regulatory progress had occurred post-elections but remains optimistic about eventual approval.
- Knyazkova (JPMorgan) also inquired about growth drivers within the MFA portfolio. CFO Glenn David explained that the Zoetis-acquired products contributed most of the segment’s growth, while legacy products were flat due to offsetting declines in Brazil.
- Knyazkova (JPMorgan) probed on livestock trends and protein demand durability. COO Larry Miller described margin pressures in poultry and swine but noted optimism for demand normalization as input costs, especially corn, decline.
- Curtis Moyles (BNP Paribas) questioned why EBITDA guidance was not raised despite a strong quarter. CFO Glenn David pointed to timing of expenses and the early stage of the financial year as reasons for maintaining guidance.
- Moyles (BNP Paribas) asked about the impact of USDA’s reopening of southern ports for livestock imports. COO Larry Miller said current imports are modest but could reach over 1 million cattle next year, supporting feedlot supply.
Catalysts in upcoming quarters
Going forward, the StockStory team will monitor (1) regulatory developments for virginiamycin in Brazil that could provide upside to sales, (2) progress on inventory reduction and improved cash conversion, and (3) the pace of recovery in poultry and livestock demand, especially as corn and feed costs evolve. Execution in shifting the Mineral Nutrition business to higher-margin segments will also be a key signpost.
Phibro Animal Health currently trades at $35.24, down from $39.43 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free).
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