Neogen Corp (NEOG) shares tumbled 5.01% in Friday's pre-market trading session, as investors reacted to a grim financial outlook and ongoing operational challenges. The food safety and animal health company has been struggling with profitability and slow revenue growth, raising concerns about its near-term prospects.

According to recent analysis, Neogen is forecast to grow revenue at a mere 0.9% per year, significantly lagging behind the broader US market's expected 9.9% annual expansion. The company's financial woes are further compounded by increasing losses, with the bottom line deteriorating at a rapid 90.4% annual pace over the past five years. Analysts project that Neogen will remain unprofitable for at least the next three years, putting additional pressure on the stock.

Integration hurdles following the acquisition of 3M's Food Safety business continue to plague Neogen, with high manual labor costs, elevated scrap, and excess expenses squeezing both gross and EBITDA margins. While the company has undertaken efforts to streamline its portfolio by shedding lower-margin businesses, the benefits of this strategic shift are yet to materialize. Despite trading at a discounted Price-to-Sales ratio of 1.7x compared to industry and peer averages, investors appear skeptical about Neogen's ability to turn its operations around in the near term, leading to today's significant stock price decline.