We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Can Companion Animal Group Drive IDEXX's (IDXX) Q3 Earnings?
Read MoreHide Full Article
We expect IDEXX Laboratories, Inc. (IDXX - Free Report) to beat expectations when it reports third-quarter 2017 results on Oct 31, before the opening bell. Last quarter, the company delivered a positive earnings surprise of 11.8%. It is worth noting that IDEXX has outperformed the Zacks Consensus Estimate in each of the preceding four quarters, at an average of 9.3%. Let’s take a look at how things are shaping up prior to this announcement.
Key Catalyst
Similar to the prior quarter, IDEXX is expected to gain from strong global growth in Companion Animal Group (CAG) Diagnostics recurring revenues. The growth in CAG Diagnostics was led by double-digit organic revenue gains across consumable, reference lab and rapid assay revenues, as well as continued expansion of IDEXX's premium instrument installed base.
We are upbeat about the 300% year-over-year rise in the uptake of SNAP Pro units in North America last quarter. Management expects the solid performance to continue in the to-be-reported quarter as well.
The Zacks Consensus Estimate for CAG Diagnostics revenues of $426 million reflects an increase of 10.6% from the year-ago quarter.
Here are the other factors that might influence IDEXX’s third-quarter results:
IDEXX expects its Livestock, Poultry and Dairy (LPD) business to witness flat-to-modest growth in the second half of 2017. The segment has been seeing continued strength in China. Also, expansion of the recurring pregnancy testing franchise buoys optimism. The Zacks Consensus Estimate for the LPD business of $30.3 million for the third quarter reflects an increase of 1.7% from the year-ago quarter.
The company continues to expand globally. It has been significantly benefitting from the bountiful opportunities in the companion animal market of emerging nations. Further, management’s consistent share buybacks reflect its strong free cash flow reserve. We believe the outcome of these endeavors will be reflected in the company’s third-quarter performance.
Encouraged by these factors, IDEXX expects 2017 revenue in the range of $1,945-$1,965 million, reflecting organic revenue growth expectations between 10% and 11%. The Zacks Consensus Estimates for third-quarter total revenues are projected at $494 million, up 10.3% from the prior-year quarter
Management also estimates its 2017 EPS guidance to the band of $3.12-$3.22 per share, supported by continued operating margin expansion aligned with its long-term goals. The outlook represents EPS growth of 28-32% on a reported basis. The Zacks Consensus Estimate for earnings of $3.17 reflects an increase of 29.9% from the year-ago quarter.
Moreover, management is upbeat about the 12% rise in the sales force in the U.S. market and some other areas in the third quarter.
On the flip side, foreign currency fluctuation is a major headwind. Another concern for the company is its high reliance on third-party distributors. The purchasing dynamics of distributors have a significant impact on the company’s sales of instrument consumables and rapid assay products. Also, the company is exposed to higher operating expenses pertaining to increased head count along with higher investments targeted toward portfolio development and geographic expansion in the United States and internationally.
Also, the competitive landscape in the domestic and overseas markets weighs on IDEXX’s performance. The struggle to gain market traction might prove to be a drag on third-quarter 2017 results.
Here is what our quantitative model predicts:
IDEXX does not have the right combination of two main ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — needed for increasing the odds of an earnings beat.
Zacks ESP: The Earnings ESP for IDEXX is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: IDEXX carries a Zacks Rank #3, which increases the predictive power of ESP. However, we also need to have a positive ESP to be confident of a positive earnings surprise.
The Zacks Consensus Estimate for earnings of 75 cents reflects a 20.9% improvement on a year-over-year basis.
Stocks Worth a Look
Here are a few medical stocks worth considering as they have the right combination of elements to post an earnings beat this quarter.
Thermo Fisher Scientific Inc. (TMO - Free Report) has an Earnings ESP of +0.19% and a Zacks Rank #2.
Align Technology, Inc. (ALGN - Free Report) has an Earnings ESP of +0.74% and a Zacks Rank #3.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
Can Companion Animal Group Drive IDEXX's (IDXX) Q3 Earnings?
We expect IDEXX Laboratories, Inc. (IDXX - Free Report) to beat expectations when it reports third-quarter 2017 results on Oct 31, before the opening bell. Last quarter, the company delivered a positive earnings surprise of 11.8%. It is worth noting that IDEXX has outperformed the Zacks Consensus Estimate in each of the preceding four quarters, at an average of 9.3%. Let’s take a look at how things are shaping up prior to this announcement.
Key Catalyst
Similar to the prior quarter, IDEXX is expected to gain from strong global growth in Companion Animal Group (CAG) Diagnostics recurring revenues. The growth in CAG Diagnostics was led by double-digit organic revenue gains across consumable, reference lab and rapid assay revenues, as well as continued expansion of IDEXX's premium instrument installed base.
We are upbeat about the 300% year-over-year rise in the uptake of SNAP Pro units in North America last quarter. Management expects the solid performance to continue in the to-be-reported quarter as well.
The Zacks Consensus Estimate for CAG Diagnostics revenues of $426 million reflects an increase of 10.6% from the year-ago quarter.
Here are the other factors that might influence IDEXX’s third-quarter results:
IDEXX Laboratories, Inc. Price and EPS Surprise
IDEXX Laboratories, Inc. Price and EPS Surprise | IDEXX Laboratories, Inc. Quote
IDEXX expects its Livestock, Poultry and Dairy (LPD) business to witness flat-to-modest growth in the second half of 2017. The segment has been seeing continued strength in China. Also, expansion of the recurring pregnancy testing franchise buoys optimism. The Zacks Consensus Estimate for the LPD business of $30.3 million for the third quarter reflects an increase of 1.7% from the year-ago quarter.
The company continues to expand globally. It has been significantly benefitting from the bountiful opportunities in the companion animal market of emerging nations. Further, management’s consistent share buybacks reflect its strong free cash flow reserve. We believe the outcome of these endeavors will be reflected in the company’s third-quarter performance.
Encouraged by these factors, IDEXX expects 2017 revenue in the range of $1,945-$1,965 million, reflecting organic revenue growth expectations between 10% and 11%. The Zacks Consensus Estimates for third-quarter total revenues are projected at $494 million, up 10.3% from the prior-year quarter
Management also estimates its 2017 EPS guidance to the band of $3.12-$3.22 per share, supported by continued operating margin expansion aligned with its long-term goals. The outlook represents EPS growth of 28-32% on a reported basis. The Zacks Consensus Estimate for earnings of $3.17 reflects an increase of 29.9% from the year-ago quarter.
Moreover, management is upbeat about the 12% rise in the sales force in the U.S. market and some other areas in the third quarter.
On the flip side, foreign currency fluctuation is a major headwind. Another concern for the company is its high reliance on third-party distributors. The purchasing dynamics of distributors have a significant impact on the company’s sales of instrument consumables and rapid assay products. Also, the company is exposed to higher operating expenses pertaining to increased head count along with higher investments targeted toward portfolio development and geographic expansion in the United States and internationally.
Also, the competitive landscape in the domestic and overseas markets weighs on IDEXX’s performance. The struggle to gain market traction might prove to be a drag on third-quarter 2017 results.
Here is what our quantitative model predicts:
IDEXX does not have the right combination of two main ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — needed for increasing the odds of an earnings beat.
Zacks ESP: The Earnings ESP for IDEXX is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: IDEXX carries a Zacks Rank #3, which increases the predictive power of ESP. However, we also need to have a positive ESP to be confident of a positive earnings surprise.
The Zacks Consensus Estimate for earnings of 75 cents reflects a 20.9% improvement on a year-over-year basis.
Stocks Worth a Look
Here are a few medical stocks worth considering as they have the right combination of elements to post an earnings beat this quarter.
The Cooper Companies, Inc. (COO - Free Report) has an Earnings ESP of +0.43% and a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Thermo Fisher Scientific Inc. (TMO - Free Report) has an Earnings ESP of +0.19% and a Zacks Rank #2.
Align Technology, Inc. (ALGN - Free Report) has an Earnings ESP of +0.74% and a Zacks Rank #3.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>