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Hologic (HOLX) Rides on Robust Preliminary Q1 Organic Sales
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Hologic Inc. (HOLX - Free Report) announced astounding preliminary revenue results for first-quarter fiscal 2021 (ended Dec 26, 2020) on Jan 8. The company’s estimate of more than double organic revenue growth enabled the stock to climb 3.2% at the day’s close to $80.49.
The company is slated to release its full financial results for the period on Jan 27.
Prelim Q1 at a Glance
Following an outstanding fiscal 2020 performance, the company kick-started the year 2021 on an extremely bullish note continuing with its strong underlying momentum. Per the preliminary announcement, total revenues for the fiscal first quarter is expected to be approximately $1,609.8 million, implying a projected 89.3% improvement year over year (or up 86.5% at constant exchange rate or CER).
The preliminary top-line number exceeds the guided range of $1,350-$1,425 million. The current Zacks Consensus Estimate of $1.38 billion too remains significantly below the preliminary figure.
As stated earlier, preliminary organic revenues doubled in the fiscal first quarter, much ahead of the company’s expectation. According to Hologic, this achievement was based on the sale of almost 30 million COVID-19 tests globally in the quarter.
Segmental Details
On a segmental basis, while Diagnostics (70.1% of total revenues) is likely to rise 256.3% at CER, GYN Surgical (7.7%) is estimated to grow 3.3% at CER on a year-over-year basis. However, Breast Health (20.7%) revenues are likely to rise a marginal 0.6% at CER. Skeletal Health (1.5%) is anticipated to rise 4% at CER. Medical Aesthetics is not expected to report any sales compared to sales of $65.3 million in the year-ago period.
The uptick in Diagnostics sales is likely to result from the increasing demand for COVID-19 testing. According to Hologic, Breast Health and Surgical businesses too are expected to report significant growth with each franchise posting growth in all major geographies – the United States, Europe and Asia-Pacific.
EPS Projection
The company also expects fiscal first quarteradjusted earnings per share (EPS) to be significantly higher than the company-provided guidance of $2.10-$2.25. The current Zacks Consensus Estimate is pegged at $2.14.
Q1 in Our Eyes
Through the fiscal first quarter, there were a number of new developments, which are expected to have contributed to the company’s top line in a formidable manner.
In Diagnostics, in October, the company’s Aptima SARS-CoV-2 assay, (which initially received Emergency Use Authorization (EUA) from the FDA in May) got extended approval to be authorized for testing of individuals without symptoms or other reasons to suspect COVID-19 infection. This while opening up the scope for testing should have contributed significantly to the quarter’s diagnostic testing revenues.
The same month, in a major breakthrough, the company received a $119-million contract from the U.S. government to expand its production capacity for COVID-19 molecular tests. This probably got reflected in the company’s quarterly preliminary sales.
In Breast Health, through the pandemic phase, the company witnessed depressed demand for many products. However, the company has already talked about a rebound in sales. According to Hologic, the increasing diversity of its Breast Health business cushioned the overall decline, as consumables and service essentially returned to their pre-COVID levels.
In December, the company announced FDA clearance and commercial availability of its Genius AI Detection technology to help detect subtle potential cancers in breast tomosynthesis images. This too is expected to have contributed to the company’s fiscal-first quarter top line within breast health.
Within GYN Surgical, the company already noted faster-than-expected recovery. Internationally, the company’s performance is expected to have been strong, banking on recent structural change and strategic developments. In this regard, we note that in Europe, Hologic recently moved away from distributors and strengthened its direct commercial capabilities under the leadership of Jan Verstreken.
Share Price Movement
Hologic has outperformed its industry over the past six months. The stock has gained 40% compared with the 24% rise of its industry.
Zacks Rank & Other Stocks to Consider
Hologic currently carries a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks from the broader medical space are Amedisys, Inc. (AMED - Free Report) , IDEXX Laboratories, Inc. (IDXX - Free Report) and Patterson Companies, Inc. (PDCO - Free Report) .
IDEXX’s long-term earnings growth rate is estimated at 15.8%. It currently carries a Zacks Rank #2 (Buy).
Patterson’s long-term earnings growth rate is estimated at 11.1%. The company presently carries a Zacks Rank #2.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.4% per year.
These 7 were selected because of their superior potential for immediate breakout.
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Hologic (HOLX) Rides on Robust Preliminary Q1 Organic Sales
Hologic Inc. (HOLX - Free Report) announced astounding preliminary revenue results for first-quarter fiscal 2021 (ended Dec 26, 2020) on Jan 8. The company’s estimate of more than double organic revenue growth enabled the stock to climb 3.2% at the day’s close to $80.49.
The company is slated to release its full financial results for the period on Jan 27.
Prelim Q1 at a Glance
Following an outstanding fiscal 2020 performance, the company kick-started the year 2021 on an extremely bullish note continuing with its strong underlying momentum. Per the preliminary announcement, total revenues for the fiscal first quarter is expected to be approximately $1,609.8 million, implying a projected 89.3% improvement year over year (or up 86.5% at constant exchange rate or CER).
The preliminary top-line number exceeds the guided range of $1,350-$1,425 million. The current Zacks Consensus Estimate of $1.38 billion too remains significantly below the preliminary figure.
As stated earlier, preliminary organic revenues doubled in the fiscal first quarter, much ahead of the company’s expectation. According to Hologic, this achievement was based on the sale of almost 30 million COVID-19 tests globally in the quarter.
Segmental Details
On a segmental basis, while Diagnostics (70.1% of total revenues) is likely to rise 256.3% at CER, GYN Surgical (7.7%) is estimated to grow 3.3% at CER on a year-over-year basis. However, Breast Health (20.7%) revenues are likely to rise a marginal 0.6% at CER. Skeletal Health (1.5%) is anticipated to rise 4% at CER. Medical Aesthetics is not expected to report any sales compared to sales of $65.3 million in the year-ago period.
The uptick in Diagnostics sales is likely to result from the increasing demand for COVID-19 testing. According to Hologic, Breast Health and Surgical businesses too are expected to report significant growth with each franchise posting growth in all major geographies – the United States, Europe and Asia-Pacific.
EPS Projection
The company also expects fiscal first quarteradjusted earnings per share (EPS) to be significantly higher than the company-provided guidance of $2.10-$2.25. The current Zacks Consensus Estimate is pegged at $2.14.
Q1 in Our Eyes
Through the fiscal first quarter, there were a number of new developments, which are expected to have contributed to the company’s top line in a formidable manner.
In Diagnostics, in October, the company’s Aptima SARS-CoV-2 assay, (which initially received Emergency Use Authorization (EUA) from the FDA in May) got extended approval to be authorized for testing of individuals without symptoms or other reasons to suspect COVID-19 infection. This while opening up the scope for testing should have contributed significantly to the quarter’s diagnostic testing revenues.
The same month, in a major breakthrough, the company received a $119-million contract from the U.S. government to expand its production capacity for COVID-19 molecular tests. This probably got reflected in the company’s quarterly preliminary sales.
In Breast Health, through the pandemic phase, the company witnessed depressed demand for many products. However, the company has already talked about a rebound in sales. According to Hologic, the increasing diversity of its Breast Health business cushioned the overall decline, as consumables and service essentially returned to their pre-COVID levels.
In December, the company announced FDA clearance and commercial availability of its Genius AI Detection technology to help detect subtle potential cancers in breast tomosynthesis images. This too is expected to have contributed to the company’s fiscal-first quarter top line within breast health.
Within GYN Surgical, the company already noted faster-than-expected recovery. Internationally, the company’s performance is expected to have been strong, banking on recent structural change and strategic developments. In this regard, we note that in Europe, Hologic recently moved away from distributors and strengthened its direct commercial capabilities under the leadership of Jan Verstreken.
Share Price Movement
Hologic has outperformed its industry over the past six months. The stock has gained 40% compared with the 24% rise of its industry.
Zacks Rank & Other Stocks to Consider
Hologic currently carries a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks from the broader medical space are Amedisys, Inc. (AMED - Free Report) , IDEXX Laboratories, Inc. (IDXX - Free Report) and Patterson Companies, Inc. (PDCO - Free Report) .
Amedisys’ long-term earnings growth rate is estimated at 14.8%. The company presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
IDEXX’s long-term earnings growth rate is estimated at 15.8%. It currently carries a Zacks Rank #2 (Buy).
Patterson’s long-term earnings growth rate is estimated at 11.1%. The company presently carries a Zacks Rank #2.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.4% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>