OPKO Health, Inc. (OPK - Free Report) delivered an adjusted loss per share of 11 cents in the third quarter of 2022 against the earnings per share (EPS) of 4 cents in the year-ago period. The figure was wider than the Zacks Consensus Estimate of a loss of 10 cents per share.
Our projection of loss per share was 11 cents, which matched the company-reported figure.
Revenues in Detail
OPKO Health registered revenues of $179.7 million in the third quarter, down 53.4% year over year. The figure, however, surpassed the Zacks Consensus Estimate by 4.1%.
The third-quarter revenue compares to our estimate of $167.7 million.
Lower segmental revenues dragged the overall top line.
Segmental Revenues
OPKO Health manages its operations through two reportable segments – Diagnostics and Pharmaceuticals.
Within the Diagnostics arm, revenues from services amounted to $142.8 million in the reported quarter, down 58% year over year, primarily due to a fall in COVID-19 testing volume.
This compares to our projection of $125.7 million from services revenues in the third quarter.
BioReference Laboratories (BRL) processed approximately 0.2 million COVID-19 polymerase chain reaction tests in the third quarter of 2022, down 90.9% year over year.
Within the Pharmaceuticals arm, revenues from products fell 12.2% to $32.4 million, primarily due to forex headwinds in OPKO Health’s Chilean and European operations and lower sales of RAYALDEE.
This compares to our projection of $34.4 million from products revenues in the third quarter.
Revenues from sales of RAYALDEE in the third quarter of 2022 were $6.9 million, down 18.8% from the prior-year period.
Revenues from the transfer of intellectual property and other totaled $4.5 million, down by 48.9% year over year.
This compares to our projection of $7.6 million of revenues from the transfer of intellectual property and other in the third quarter.
Margin Analysis
In the quarter under review, OPKO Health’s gross profit fell 77.9% to $31.3 million. Gross margin contracted by a stupendous 1934 basis points (bps) to 17.4%.
We had projected 14.7% of gross margin for the third quarter.
Selling, general and administrative expenses fell 24.2% to $79.7 million. Research and development expenses rose 2.7% year over year to $18.8 million. Adjusted operating expenses of $98.5 million decreased 20.2% year over year.
Adjusted operating loss totaled $67.2 million against the prior-year quarter’s adjusted operating profit of $18.4 million.
Financial Position
OPKO Health exited the third quarter of 2022 with cash and cash equivalents of $180.8 million compared with $210.5 million at the end of the second quarter.
Our Take
OPKO Health exited the third quarter of 2022 with lower-than-expected earnings. The dismal top-line and bottom-line performances are concerning. Lower segmental revenues and lower BRL testing volumes are also worrying. The decline in RAYALDEE sales is another area of concern. The gross margin contraction and persistent operating loss for OPKO Health also do not bode well for the company.
On the positive side, OPKO Health exited the third quarter with better-than-expected revenues. The continued launch of OPKO Health’s NGENLA (somatrogon) by Pfizer Inc. in Japan, Germany and other global markets looks promising. Pfizer is currently seeking pricing approvals in additional European countries and continuing to work with the FDA to obtain approval in the United States. Further, OPKO Health’s buyout of ModeX Therapeutics, Inc. continues to benefit it as the latter progresses its proprietary immunotherapy pipeline. These developments raise our optimism about OPKO Health. The company’s continued strength in its women's health and oncology businesses also augurs well.
Zacks Rank and Stocks to Consider
OPKO Health currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader medical space that have announced quarterly results are AMN Healthcare Services, Inc. (AMN - Free Report) , Medpace Holdings, Inc. (MEDP - Free Report) and Merit Medical Systems, Inc. (MMSI - Free Report) .
AMN Healthcare, carrying a Zacks Rank #2 (Buy), reported third-quarter 2022 adjusted EPS of $2.57, which beat the Zacks Consensus Estimate by 10.3%. Revenues of $1.14 billion outpaced the consensus mark by 3.9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
AMN Healthcare has an estimated long-term growth rate of 3.3%. AMN’s earnings surpassed estimates in all the trailing four quarters, the average being 10.9%.
Medpace Holdings, sporting a Zacks Rank #1, reported third-quarter 2022 EPS of $2.05, which beat the Zacks Consensus Estimate by 39.5%. Revenues of $383.7 million outpaced the consensus mark by 8.1%.
Medpace Holdings has an estimated growth rate of 44.9% for the full-year 2022. MEDP’s earnings surpassed estimates in all the trailing four quarters, the average being 22%.
Merit Medical, carrying a Zacks Rank #2, reported third-quarter 2022 adjusted EPS of 64 cents, which beat the Zacks Consensus Estimate by 20.8%. Revenues of $287.2 million outpaced the consensus mark by 5.2%.
Merit Medical has an estimated long-term growth rate of 11%. MMSI’s earnings surpassed estimates in all the trailing four quarters, the average being 25.4%.
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Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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OPKO Health, Inc. (OPK - Free Report) delivered an adjusted loss per share of 11 cents in the third quarter of 2022 against the earnings per share (EPS) of 4 cents in the year-ago period. The figure was wider than the Zacks Consensus Estimate of a loss of 10 cents per share.
Our projection of loss per share was 11 cents, which matched the company-reported figure.
Revenues in Detail
OPKO Health registered revenues of $179.7 million in the third quarter, down 53.4% year over year. The figure, however, surpassed the Zacks Consensus Estimate by 4.1%.
The third-quarter revenue compares to our estimate of $167.7 million.
Lower segmental revenues dragged the overall top line.
Segmental Revenues
OPKO Health manages its operations through two reportable segments – Diagnostics and Pharmaceuticals.
Within the Diagnostics arm, revenues from services amounted to $142.8 million in the reported quarter, down 58% year over year, primarily due to a fall in COVID-19 testing volume.
This compares to our projection of $125.7 million from services revenues in the third quarter.
BioReference Laboratories (BRL) processed approximately 0.2 million COVID-19 polymerase chain reaction tests in the third quarter of 2022, down 90.9% year over year.
Within the Pharmaceuticals arm, revenues from products fell 12.2% to $32.4 million, primarily due to forex headwinds in OPKO Health’s Chilean and European operations and lower sales of RAYALDEE.
This compares to our projection of $34.4 million from products revenues in the third quarter.
Revenues from sales of RAYALDEE in the third quarter of 2022 were $6.9 million, down 18.8% from the prior-year period.
Revenues from the transfer of intellectual property and other totaled $4.5 million, down by 48.9% year over year.
This compares to our projection of $7.6 million of revenues from the transfer of intellectual property and other in the third quarter.
Margin Analysis
In the quarter under review, OPKO Health’s gross profit fell 77.9% to $31.3 million. Gross margin contracted by a stupendous 1934 basis points (bps) to 17.4%.
We had projected 14.7% of gross margin for the third quarter.
Selling, general and administrative expenses fell 24.2% to $79.7 million. Research and development expenses rose 2.7% year over year to $18.8 million. Adjusted operating expenses of $98.5 million decreased 20.2% year over year.
Adjusted operating loss totaled $67.2 million against the prior-year quarter’s adjusted operating profit of $18.4 million.
Financial Position
OPKO Health exited the third quarter of 2022 with cash and cash equivalents of $180.8 million compared with $210.5 million at the end of the second quarter.
Our Take
OPKO Health exited the third quarter of 2022 with lower-than-expected earnings. The dismal top-line and bottom-line performances are concerning. Lower segmental revenues and lower BRL testing volumes are also worrying. The decline in RAYALDEE sales is another area of concern. The gross margin contraction and persistent operating loss for OPKO Health also do not bode well for the company.
On the positive side, OPKO Health exited the third quarter with better-than-expected revenues. The continued launch of OPKO Health’s NGENLA (somatrogon) by Pfizer Inc. in Japan, Germany and other global markets looks promising. Pfizer is currently seeking pricing approvals in additional European countries and continuing to work with the FDA to obtain approval in the United States. Further, OPKO Health’s buyout of ModeX Therapeutics, Inc. continues to benefit it as the latter progresses its proprietary immunotherapy pipeline. These developments raise our optimism about OPKO Health. The company’s continued strength in its women's health and oncology businesses also augurs well.
Zacks Rank and Stocks to Consider
OPKO Health currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader medical space that have announced quarterly results are AMN Healthcare Services, Inc. (AMN - Free Report) , Medpace Holdings, Inc. (MEDP - Free Report) and Merit Medical Systems, Inc. (MMSI - Free Report) .
AMN Healthcare, carrying a Zacks Rank #2 (Buy), reported third-quarter 2022 adjusted EPS of $2.57, which beat the Zacks Consensus Estimate by 10.3%. Revenues of $1.14 billion outpaced the consensus mark by 3.9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
AMN Healthcare has an estimated long-term growth rate of 3.3%. AMN’s earnings surpassed estimates in all the trailing four quarters, the average being 10.9%.
Medpace Holdings, sporting a Zacks Rank #1, reported third-quarter 2022 EPS of $2.05, which beat the Zacks Consensus Estimate by 39.5%. Revenues of $383.7 million outpaced the consensus mark by 8.1%.
Medpace Holdings has an estimated growth rate of 44.9% for the full-year 2022. MEDP’s earnings surpassed estimates in all the trailing four quarters, the average being 22%.
Merit Medical, carrying a Zacks Rank #2, reported third-quarter 2022 adjusted EPS of 64 cents, which beat the Zacks Consensus Estimate by 20.8%. Revenues of $287.2 million outpaced the consensus mark by 5.2%.
Merit Medical has an estimated long-term growth rate of 11%. MMSI’s earnings surpassed estimates in all the trailing four quarters, the average being 25.4%.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
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