Why a $3.5 Million Bet Targets Avantor Amid a 54% Stock Drop
Key Points
Circumference Group initiated a new position in Avantor, buying up 305,000 shares during the fourth quarter.
The quarter-end position value increased by $3.50 million, reflecting the purchase of the 305,000 shares.
Avantor stake accounts for 3.77% of portfolio AUM, placing it outside the fund's top five holdings.
On February 17, 2026, Circumference Group disclosed a new position in Avantor (NYSE:AVTR), acquiring 305,000 shares worth $3.50 million in the fourth quarter.
What happened
According to a SEC filing dated February 17, 2026, Circumference Group reported establishing a new position in Avantor by acquiring 305,000 shares. The shares were worth $3.5 million at quarter’s end.
What else to know
- This new position represents 3.77% of Circumference Group LLC’s 13F reportable assets as of December 31, 2025.
- Top holdings after the filing:
- NYSE:TWLO: $9.25 million (10.3% of AUM)
- NASDAQ:UPWK: $7.63 million (8.5% of AUM)
- NASDAQ:RGP: $7.00 million (7.8% of AUM)
- NYSE:PATH: $6.31 million (7.0% of AUM)
- NYSE:TDC: $5.33 million (5.9% of AUM)
- As of Friday, shares were priced at $7.51, down 54% over the past year and well underperforming the S&P 500, which is instead up about 15% in the same period.
Company overview
| Metric | Value |
|---|---|
| Revenue (TTM) | $6.55 billion |
| Net Income (TTM) | ($530.20 million) |
| Market Capitalization | $5.1 billion |
| Price (as of Friday) | $7.51 |
Company snapshot
- Avantor offers a comprehensive portfolio of laboratory materials, consumables, equipment, and specialty procurement services for biopharma, healthcare, education, advanced technologies, and applied materials sectors.
- The firm generates revenue primarily through the sale of high-purity chemicals, reagents, lab supplies, and value-added services, including onsite lab support and biopharmaceutical development solutions.
- It serves a global customer base consisting of biopharmaceutical companies, healthcare providers, academic and government institutions, and advanced technology firms.
Avantor, Inc. is a leading global provider of mission-critical products and services for the life sciences and advanced technology industries. The company leverages a broad product portfolio and specialized services to support research, production, and development needs across multiple geographies. Avantor's scale, operational expertise, and focus on high-growth end markets underpin its competitive positioning in the healthcare and scientific supply chain.
What this transaction means for investors
Moving into Avantor now might make sense because the company is generating real cash even as growth stalls, with quarterly sales down 1% to $1.66 billion and full-year revenue exceeding $6.5 billion. Profitability has declined, highlighted by a full-year loss due to one-time charges, but adjusted EBITDA exceeded $1 billion, and free cash flow approached $500 million.
Meanwhile, this could improve with management’s “Revival” program, which aims to address execution and cost structure issues, focusing on go-to-market strategies and supply chain improvements.
Ultimately, unlike high-growth biotech firms, Avantor benefits from stable demand for lab consumables and production workflows, and for long-term investors, the key will be whether margins can recover without sacrificing volume; effective execution could turn Avantor into a strong cash generator.
Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Twilio and UiPath. The Motley Fool recommends Teradata and Upwork. The Motley Fool has a disclosure policy.