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Can Breast Health Growth Drive Hologic's (HOLX) Q2 Earnings?
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Hologic, Inc. (HOLX - Free Report) is slated to report second-quarter fiscal 2019 results on May 1, after the closing bell. The company's earnings surpassed the Zacks Consensus Estimate in two of the last four quarters, the average beat being 0.91%.
Let's see how things are shaping up prior to this announcement.
Key Catalysts
Hologic is optimistic about riding on strength in the Breast Health segment in the to-be-reported quarter. There has been a consistent rise in the market share within Breast Health on the back of direct-to-consumer initiatives, introduction of products plus software and services along with a strong mammography systems portfolio.
In recent times, this segment is growing fast onlarge installed base of market-leading, clinically differentiated Genius 3D mammography systems. Specifically, the company has launched new mammography systems and also acquired two small companies, namely Focal Therapeutics and Faxitron Biopticsto enter the adjacent growth market of breast-conserving surgery.
The company is carrying on with its work to strengthen its existing installed base of 3D systems for upgrades, such as the new Intelligent 2D, Clarity HD and the SmartCurve products. Notably, these enhancements already contributed about 200 basis points to global breast health growth in the last reported quarter.
All the aforementioned developments are expected to add to the company’s Breast Health top line in the second quarter.
The Zacks Consensus Estimate for Mamography/ Breast Care revenues is pegged at $321 million, indicating rise of 7% from the prior-year quarter’s reported figure. The consensus estimate for Interventional Breast Solutions revenues stands at $56 million, suggesting a 12.7% rise from the year-earlier quarter’s reported number.
Other factors that are likely to influence Hologic's results in the fiscal second quarter are as follows:
The company expects its Diagnostics segment to maintain a stellar performance in the fiscal second quarter on the back of strength in the Molecular Diagnostics business. In the United States, it is likely to gain from its expanding market share and the utilization of its Panther system along with market growth by dint of conforming to the testing guidelines.
Global growth in the Molecular Diagnostics segment can be attributed to Hologic's Panther system, its fully-automated molecular diagnostics instrument. The company currently has more than 15 tests that have been FDA-cleared or CE-marked to run on the Panther or the Panther Fusion platforms.
The company is seeing strong demand for virology tests as well. A similar trend is expected to be maintained in the to-be-reported quarter.
The Zacks Consensus Estimate of $159 million for Molecular Diagnostics revenues implies an improvement of 5.3% from the year-ago quarter’s reported level.
Management is highly upbeat about its international performance as well. During the first quarter of fiscal 2019, international revenues rose 10.7% at constant exchange rate, primarily on a solid contribution from the Molecular Diagnostics, Breast Health and Gyn Surgical businesses. This momentum is expected to continue in the to-be-reported quarter as well.
On the flip side, Hologic has faced challenges like an unfavorable foreign currency movement over the last few quarters. Escalating operating expenses and an intense competition, particularly in the tomosynthesis market, are lingering headwinds.
What the Model Suggests
The proven Zacks model predicts that a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has higher chances of beating estimates if it also has a positive Earnings ESP.
Hologic currently has a Zacks Rank #3, which increases the predictive power of ESP and an Earnings ESP of +0.64%. Thus this combination hints at the company’s prospects to likely beat on earnings this season. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
The Zacks Consensus Estimate for earnings of 57 cents is up 3.6% from the year-ago reported figure.
Other Stocks Worth a Look
Here are a few other medical stocks worth considering as these too have the right combination of elements to beat estimates this reporting cycle.
Evolus, Inc. (EOLS - Free Report) has an Earnings ESP of +24.39% and a Zacks Rank of 3.
Aurora Cannabis, Inc. (ACB - Free Report) has an Earnings ESP of +73.33% and is a #3 Ranked player.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
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Can Breast Health Growth Drive Hologic's (HOLX) Q2 Earnings?
Hologic, Inc. (HOLX - Free Report) is slated to report second-quarter fiscal 2019 results on May 1, after the closing bell. The company's earnings surpassed the Zacks Consensus Estimate in two of the last four quarters, the average beat being 0.91%.
Let's see how things are shaping up prior to this announcement.
Key Catalysts
Hologic is optimistic about riding on strength in the Breast Health segment in the to-be-reported quarter. There has been a consistent rise in the market share within Breast Health on the back of direct-to-consumer initiatives, introduction of products plus software and services along with a strong mammography systems portfolio.
In recent times, this segment is growing fast onlarge installed base of market-leading, clinically differentiated Genius 3D mammography systems. Specifically, the company has launched new mammography systems and also acquired two small companies, namely Focal Therapeutics and Faxitron Biopticsto enter the adjacent growth market of breast-conserving surgery.
Hologic, Inc. Price and EPS Surprise
Hologic, Inc. Price and EPS Surprise | Hologic, Inc. Quote
The company is carrying on with its work to strengthen its existing installed base of 3D systems for upgrades, such as the new Intelligent 2D, Clarity HD and the SmartCurve products. Notably, these enhancements already contributed about 200 basis points to global breast health growth in the last reported quarter.
All the aforementioned developments are expected to add to the company’s Breast Health top line in the second quarter.
The Zacks Consensus Estimate for Mamography/ Breast Care revenues is pegged at $321 million, indicating rise of 7% from the prior-year quarter’s reported figure. The consensus estimate for Interventional Breast Solutions revenues stands at $56 million, suggesting a 12.7% rise from the year-earlier quarter’s reported number.
Other factors that are likely to influence Hologic's results in the fiscal second quarter are as follows:
The company expects its Diagnostics segment to maintain a stellar performance in the fiscal second quarter on the back of strength in the Molecular Diagnostics business. In the United States, it is likely to gain from its expanding market share and the utilization of its Panther system along with market growth by dint of conforming to the testing guidelines.
Global growth in the Molecular Diagnostics segment can be attributed to Hologic's Panther system, its fully-automated molecular diagnostics instrument. The company currently has more than 15 tests that have been FDA-cleared or CE-marked to run on the Panther or the Panther Fusion platforms.
The company is seeing strong demand for virology tests as well. A similar trend is expected to be maintained in the to-be-reported quarter.
The Zacks Consensus Estimate of $159 million for Molecular Diagnostics revenues implies an improvement of 5.3% from the year-ago quarter’s reported level.
Management is highly upbeat about its international performance as well. During the first quarter of fiscal 2019, international revenues rose 10.7% at constant exchange rate, primarily on a solid contribution from the Molecular Diagnostics, Breast Health and Gyn Surgical businesses. This momentum is expected to continue in the to-be-reported quarter as well.
On the flip side, Hologic has faced challenges like an unfavorable foreign currency movement over the last few quarters. Escalating operating expenses and an intense competition, particularly in the tomosynthesis market, are lingering headwinds.
What the Model Suggests
The proven Zacks model predicts that a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has higher chances of beating estimates if it also has a positive Earnings ESP.
Hologic currently has a Zacks Rank #3, which increases the predictive power of ESP and an Earnings ESP of +0.64%. Thus this combination hints at the company’s prospects to likely beat on earnings this season. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
The Zacks Consensus Estimate for earnings of 57 cents is up 3.6% from the year-ago reported figure.
Other Stocks Worth a Look
Here are a few other medical stocks worth considering as these too have the right combination of elements to beat estimates this reporting cycle.
Evolus, Inc. (EOLS - Free Report) has an Earnings ESP of +24.39% and a Zacks Rank of 3.
NanoString Technologies Inc. has an Earnings ESP of +3.08% and is a Zacks #3 Ranked player. You can see the complete list of today's Zacks #1 Rank stocks here.
Aurora Cannabis, Inc. (ACB - Free Report) has an Earnings ESP of +73.33% and is a #3 Ranked player.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
See their latest picks free >>