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Haemonetics Plasma Arm Advances, Blood Center Sluggish

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On Jul 13, we issued an updated research report on Haemonetics Corporation (HAE - Free Report) , a Braintree, MA-based leading provider of blood management solutions to customers encompassing blood and plasma collectors, hospitals and health care providers globally. The stock currently carries a Zacks Rank #3 (Hold).

For the past year, Haemonetics has been trading above the Zacks categorized Medical - Products industry. Over this period, the stock has surged 34.7% compared with the broader industry’s 10.4%.

We are particularly encouraged by the company’s consistent growth in both its Plasma segment as well as the Haemonetics Management franchises.

Haemonetics has been witnessing a strong flourish in its Plasma franchise for quite some time now. Management has also maintained high confidence in the continued growth of its commercial plasma collection business.

Of late, management declared that its NextGen plasma collection software has been seeing avid customer interest. Management’s 2018 guidance for Plasma revenue growth is 3-5% inclusive of the divestiture of SEBRA bench-top and handheld sealers, representing 1.4% of annual Plasma revenue in the fourth quarter of 2017.

The company’s Hospital business is also progressing well. The TEG line of products has gained popularity worldwide. The TEG 5000 is approved of for a broad set of indications in all its top markets. The TEG 6s and TEG Manager are sanctioned for the same set of indications in Europe, Australia and Japan.

In the U.S., TEG 6s is to be used for cardiovascular surgery and the company is presently pursuing a broader set of indications, beginning with trauma.

On the flip side, the company has been witnessing sluggish revenue growth at the Blood Center franchise. This has significantly affected Haemonetics’ results over the past few quarters. Management also doesn’t expect any early recovery in the Blood Center’s outcomes.

Macroeconomic uncertainty continues to pose a challenge for Haemonetics. Management also anticipates slower-than-expected product adoption by customers to reduce revenues and profits. Also, currency fluctuations and a stiff competition continue to hamper the stock.

Other Key Picks

Some better-ranked medical stocks are Mesa Laboratories, Inc. (MLAB - Free Report) , Edwards Lifesciences Corp. (EW - Free Report) and Align Technology, Inc. (ALGN - Free Report) . Both Mesa Laboratories and Edwards Lifesciences sport a Zacks Rank #1 (Strong Buy), while Align Technology carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Mesa Laboratories delivered a positive earnings surprise of 2.84% over the last four quarters. The stock gained roughly 9.1% over the last three months.

Edwards Lifesciences has a long-term expected earnings growth rate of 15.2%. The stock climbed around 21.3% over the last three months.

Align Technology has an expected long-term adjusted earnings growth of almost 24.1%. The stock surged approximately 32.1% over the last three months.

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