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Why Should You Add Haemonetics (HAE) to Your Portfolio Now?
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Haemonetics Corporation (HAE - Free Report) has been on a healthy growth trajectory of late. Shares of the company have soared 67.1% in the last six months, ahead of the S&P 500 index’s 3.1% gain. The stock has a market cap of $3.88 billion.
Over the past year, this Zacks Rank #1 (Strong Buy) stock has demonstrated a continuous uptrend and has returned a remarkable 83.3% compared with the S&P 500 index’s growth of 10.8%. The value is also higher than the broader industry’s 10.9% rally.
Further, the stock delivered an average positive earnings surprise of 17.5% in the trailing four quarters. A positive growth rate of 14.5% for 2019 also instils investors’ optimism in the stock.
Moreover, estimate revision trends for 2018 earnings look impressive. For the stock has seen the Zacks Consensus Estimate moving five times north over the last 60 days with no downward revision witnessed.
Factors Driving Haemonetics
Let’s take a look at the possible growth propellers:
Surging Segmental Revenues: Last quarter, Plasma revenues for this Massachusetts-based blood management company were up 4% on a year-over-year basis. This upside was driven by a strong performance in disposables and software, particularly in the United States. Additionally, Hospital Business revenues grew 6% on the back of consistent results in North America as well as improved international results in the key markets.
Expanding Margins: Last quarter, gross margin expanded 310 basis points (bps) to 47.6% on a year-over-year basis. Meanwhile, operating margin improved 270 bps to 17.9% year over year.
NexSys PCS: Market seems to be upbeat about Haemonetics’ recently-introduced platform, NexSys Plasma Collection System (PCS). The device is designed to increase overall plasma yield per donor through planned embedded software upgrades.
Notably, the device has also received an FDA clearance of late with a CE Mark expected come spring. Moreover, management expects a 510 (k) submission for the embedded software and firmware via which, the NexSys PCS functions.
EPS Guidance Raised: Haemonetics upped 2018 guidance for earnings to the range of $1.80-$1.90 per share compared with the previous projection of $1.65-$1.75. This lifted view is indicative of the continuation of the overall bullish sentiment surrounding the stock.
Other Key Picks
A few other top-ranked stocks in the broader medical sector are Bio-Rad Laboratories (BIO - Free Report) , athenahealth, Inc. and Varian Medical Systems, Inc. .
athenahealth is a Zacks #1 Ranked player. The company has a long-term expected earnings growth rate of 21.5%.
Varian Medical has a long-term expected earnings growth rate of 8%. The stock carries a Zacks Rank #2 (Buy).
5 Medical Stocks to Buy Now
Zacks names 5 companies poised to ride a medical breakthrough that is targeting cures for leukemia, AIDS, muscular dystrophy, hemophilia, and other conditions.
New products in this field are already generating substantial revenue and even more wondrous treatments are in the pipeline. Early investors could realize exceptional profits.
Image: Bigstock
Why Should You Add Haemonetics (HAE) to Your Portfolio Now?
Haemonetics Corporation (HAE - Free Report) has been on a healthy growth trajectory of late. Shares of the company have soared 67.1% in the last six months, ahead of the S&P 500 index’s 3.1% gain. The stock has a market cap of $3.88 billion.
Over the past year, this Zacks Rank #1 (Strong Buy) stock has demonstrated a continuous uptrend and has returned a remarkable 83.3% compared with the S&P 500 index’s growth of 10.8%. The value is also higher than the broader industry’s 10.9% rally.
Further, the stock delivered an average positive earnings surprise of 17.5% in the trailing four quarters. A positive growth rate of 14.5% for 2019 also instils investors’ optimism in the stock.
Moreover, estimate revision trends for 2018 earnings look impressive. For the stock has seen the Zacks Consensus Estimate moving five times north over the last 60 days with no downward revision witnessed.
Factors Driving Haemonetics
Let’s take a look at the possible growth propellers:
Surging Segmental Revenues: Last quarter, Plasma revenues for this Massachusetts-based blood management company were up 4% on a year-over-year basis. This upside was driven by a strong performance in disposables and software, particularly in the United States. Additionally, Hospital Business revenues grew 6% on the back of consistent results in North America as well as improved international results in the key markets.
Expanding Margins: Last quarter, gross margin expanded 310 basis points (bps) to 47.6% on a year-over-year basis. Meanwhile, operating margin improved 270 bps to 17.9% year over year.
NexSys PCS: Market seems to be upbeat about Haemonetics’ recently-introduced platform, NexSys Plasma Collection System (PCS). The device is designed to increase overall plasma yield per donor through planned embedded software upgrades.
Notably, the device has also received an FDA clearance of late with a CE Mark expected come spring. Moreover, management expects a 510 (k) submission for the embedded software and firmware via which, the NexSys PCS functions.
EPS Guidance Raised: Haemonetics upped 2018 guidance for earnings to the range of $1.80-$1.90 per share compared with the previous projection of $1.65-$1.75. This lifted view is indicative of the continuation of the overall bullish sentiment surrounding the stock.
Other Key Picks
A few other top-ranked stocks in the broader medical sector are Bio-Rad Laboratories (BIO - Free Report) , athenahealth, Inc. and Varian Medical Systems, Inc. .
Bio-Rad Laboratories sports a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here. The company has a long-term expected earnings growth rate of 20%.
athenahealth is a Zacks #1 Ranked player. The company has a long-term expected earnings growth rate of 21.5%.
Varian Medical has a long-term expected earnings growth rate of 8%. The stock carries a Zacks Rank #2 (Buy).
5 Medical Stocks to Buy Now
Zacks names 5 companies poised to ride a medical breakthrough that is targeting cures for leukemia, AIDS, muscular dystrophy, hemophilia, and other conditions.
New products in this field are already generating substantial revenue and even more wondrous treatments are in the pipeline. Early investors could realize exceptional profits.
Click here to see the 5 stocks >>