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Exact Sciences (EXAS) to Post Q1 Earnings: What's in Store?

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Exact Sciences Corporation (EXAS - Free Report) is scheduled to report first-quarter 2019 earnings results on Apr 30, 2019, after the market closes.

The company’s track record has been impressive so far, having delivered a positive surprise in each of the trailing four quarters, the average being 16.26%. In the last reported quarter, Exact Sciences came up with an earnings surprise of 12%.

Shares of Exact Sciences have surged 46.1% in the year so far, outperforming the industry’s increase of 2.9%.

Let’s see how things are shaping up for the upcoming quarterly results.

Factors to Consider

Exact Sciences’ top line mainly consists of laboratory service revenues generated from Cologuard, a non-invasive screening test for colorectal cancer. Cologuard test volume increased both year over year and sequentially in the fourth quarter of 2018 as a large number of healthcare providers ordered their first Cologuard test. We expect this positive trend to continue in the first quarter as well.

In February 2019, Cologuard screening test volume crossed the 2-million mark since its launch in 2014. Exact Sciences is intensely focused on accelerating this momentum by adding a test lab facility and increasing its workforce. The company concentrates on raising awareness of the importance of colorectal cancer screening and early cancer detection of the dreadful disease. Going forward, we expect the number of people undergoing screening for colorectal cancer to burgeon, which will be a huge boon to Cologuard.

We would like to remind investors that Cologuard is the first and the only FDA-approved non-invasive DNA screening option for colorectal cancer. Last August, Exact Sciences entered into an agreement with the drug giant Pfizer (PFE - Free Report) to co-promote its Cologuard test for the detection of colorectal cancer in the United States. This nationwide co-promotion deal will be valid through 2021 end.

We expect investors’ focus to be on the sales volume generated by Cologuard during the upcoming earnings call.

Earnings Whispers

Our proven model does not conclusively show that Exact Sciences is likely to beat on earnings this reporting cycle. This is because the stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as you will see below.

Earnings ESP: Exact Sciences has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at a loss of 64 cents each. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Exact Sciences carries a Zacks Rank #4 (Sell), which lowers the predictive power of ESP. Moreover, a 0.00% ESP in the combination makes surprise prediction difficult for the stock this earnings season.  

We caution against stocks with a Zacks Rank of 4 or 5 going into an earnings announcement, especially when the company is seeing negative estimate revisions.

Exact Sciences Corporation Price and EPS Surprise

Stocks That Warrant a Look

Here are a few health care stocks worth considering as our model shows that these have the right mix of elements to beat estimates this time around.

Aduro Biotech, Inc. has a Zacks Rank #2 and an Earnings ESP of +82.00%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Incyte Corporation (INCY - Free Report) has an Earnings ESP of +14.47% and a Zacks Rank of 1. The company is scheduled to release first-quarter results on Apr 30, before the market opens.

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