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Qiagen Banks on Molecular Diagnostic amid Currency Woes

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On May 4, we issued an updated research report on leading molecular diagnostic company, Qiagen N.V. (QGEN - Free Report) . The stock currently has a Zacks Rank #3 (Hold).

In the last three months, QIAGEN was trading below the Zacks categorized Medical - Biomedical and Genetics industry until it released an impressive first quarter. While earnings exceeded the Zacks Consensus Estimate, revenues met the same. We are impressed with the company’s balanced growth across all segments. This has bolstered market confidence leading to a rally in the share price, which has been treading higher since the impressive first-quarter release. The stock gained 10.59% in the last three months, ahead of the broader industry’s gain of 1.39%.

We are encouraged to note that the company is growing steadily on the back of immense potential in the molecular diagnostic space. The first quarter has been no exception in this regard. During the quarter, the company experienced strong sales growth for its QuantiFERON-TB test, the infectious disease testing portfolio, as well as growth in consumables used in QIAsymphony. Recently, the Abu Dhabi Health Services Company (SEHA) chose QuantiFERON-TB for routine pre-employment and healthcare worker screening. Placements of the QIAsymphony system were also robust and QIAGEN is positioned to cross the 2,000 cumulative placement mark by the end of 2017.

In international markets as well, growth has been pretty solid during the first quarter. The company’s performance has been mainly driven by expansion in markets such as France, U.K., Turkey and the Middle East. Also, QIAGEN opened a hub in Dubai. This helped the company to more than offset the software trends in Germany that was witnessed in the second half of 2016.

Other major upsides include the company’s continuous progress with innovation and product launch. Also, strategic collaborations have helped the company maintain its growth momentum.

On the flip side, foreign exchange headwinds continue to remain a major dampener for the company’s international performance. Based on the present exchange rates, management currently expects an adverse currency impact of 2% on sales at actual rates and up to 2 cents on adjusted diluted EPS in 2017.

Zacks Rank & Key Picks

Qiagen currently has a Zacks Rank #3 (Hold). Better-ranked medical stocks include Hologic, Inc. (HOLX - Free Report) , Baxter International Inc. (BAX - Free Report) and Progenics Pharmaceuticals, Inc. . Hologic sports a Zacks Rank 1 (Strong Buy), while Baxter International and Progenics Pharmaceuticals carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Hologic gained 32.91% in the last one year, in comparison to the S&P 500’s 16.43%. The company has a stellar four-quarter average earnings surprise of over 4.16%.

Baxter International rose around 23.92% in the last one year, in comparison to the S&P 500. It has a four-quarter average earnings surprise of 17.14%.

Progenics Pharmaceuticals gained 26.08% in the past one year, better than the S&P 500 mark. It has a four-quarter average earnings surprise of 10.01%.

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