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Why Is Omnicell (OMCL) Up 0.8% Since Last Earnings Report?
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A month has gone by since the last earnings report for Omnicell (OMCL - Free Report) . Shares have added about 0.8% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Omnicell due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Omnicell Q4 Earnings Top, Margins Down
Omnicell reported fourth-quarter 2020 adjusted earnings per share of 91 cents, up 18.2% year over year. The metric also exceeded the Zacks Consensus Estimate by 5.8%.
The adjustments include one-time expenses like share-based compensation, amortization expenses, severance and other.
On a GAAP basis, earnings per share were 37 cents for the quarter under review compared with earnings per share of 51 cents in the year-ago quarter.
For the full year, adjusted earnings were $2.54 per share, 9.6% down from the year-ago period. It, however, beat the Zacks Consensus Estimate by 1.6%.
Revenues in Detail
Fourth-quarter revenues of $249.2 million rose 0.36% year over year on a reported basis. The figure, however, beat the Zacks Consensus Estimate by 3.31%.
Total revenues for 2020 were $892.2 million, down 0.5% from the year-ago period. This also surpassed the Zacks Consensus Estimate by 0.9%.
Segmental Details
On a segmental basis, Product revenues fell 6.1% year over year to $175.7 million in the reported quarter.
Service and other revenues climbed 20.2% year over year to $73.5 million.
Although the company’s year-over-year revenues declined largely due to delays in bookings and implementations related to COVID-19, there was a 16.1% sequential improvement with the economy gradually getting back to normalcy.
Operational Update
In the quarter under review, adjusted gross profit edged up 0.04% to $123.7 million. However, gross margin contracted 16 basis points (bps) to 49.6%.
Operating expenses were $103.4 million in the fourth quarter, up 1.9% year over year. Operating profit totaled $20.2 million, reflecting an 8.9% fall from the prior-year quarter. Operating margin in the fourth quarter contracted 82 bps to 8.1%.
Financial Update
Omnicell exited the full year with cash and cash equivalents of $485.9 million compared with $127.2 million at the end of 2019.
Cumulative cash flow from operating activities at the end of 2020 was $185.8 million compared with $145 million a year ago.
Q1 and 2021 Guidance
Omnicell noted that its customers resumed their pre-COVID purchasing patterns. The company also stated that its customers are still navigating the impact of COVID-19 and are in dire need for the company’s medication management automation solutions more strategically.
Based on this assumption, the company is confident about its outlook for 2021. For the first quarter of 2021, Omnicell expects revenues between $243 million and $248 million. The Zacks Consensus Estimate for the metric is pegged at $243.8 million.
Product revenues are forecasted between $171 million and $174 million while service revenues are projected within $72-$74 million for the quarter.
First-quarter adjusted EPS is envisioned in the band of 64-69 cents. The Zacks Consensus Estimate for the same is pegged at 53 cents.
For the full year, the company expects product bookings between $1.09 billion and $1.15 billion. Revenues are estimated between $1.08 billion and $1.10 billion.
For 2021, the anticipated ranges for product and service revenues are $770-$785 million and $315-$320 million, respectively.
Full-year adjusted earnings per share is expected between $3.40 and $3.60 for 2021. The Zacks Consensus Estimate for the metric stands at $3.29.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision. The consensus estimate has shifted 63.33% due to these changes.
VGM Scores
At this time, Omnicell has a strong Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Omnicell has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Omnicell (OMCL) Up 0.8% Since Last Earnings Report?
A month has gone by since the last earnings report for Omnicell (OMCL - Free Report) . Shares have added about 0.8% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Omnicell due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Omnicell Q4 Earnings Top, Margins Down
Omnicell reported fourth-quarter 2020 adjusted earnings per share of 91 cents, up 18.2% year over year. The metric also exceeded the Zacks Consensus Estimate by 5.8%.
The adjustments include one-time expenses like share-based compensation, amortization expenses, severance and other.
On a GAAP basis, earnings per share were 37 cents for the quarter under review compared with earnings per share of 51 cents in the year-ago quarter.
For the full year, adjusted earnings were $2.54 per share, 9.6% down from the year-ago period. It, however, beat the Zacks Consensus Estimate by 1.6%.
Revenues in Detail
Fourth-quarter revenues of $249.2 million rose 0.36% year over year on a reported basis. The figure, however, beat the Zacks Consensus Estimate by 3.31%.
Total revenues for 2020 were $892.2 million, down 0.5% from the year-ago period. This also surpassed the Zacks Consensus Estimate by 0.9%.
Segmental Details
On a segmental basis, Product revenues fell 6.1% year over year to $175.7 million in the reported quarter.
Service and other revenues climbed 20.2% year over year to $73.5 million.
Although the company’s year-over-year revenues declined largely due to delays in bookings and implementations related to COVID-19, there was a 16.1% sequential improvement with the economy gradually getting back to normalcy.
Operational Update
In the quarter under review, adjusted gross profit edged up 0.04% to $123.7 million. However, gross margin contracted 16 basis points (bps) to 49.6%.
Operating expenses were $103.4 million in the fourth quarter, up 1.9% year over year. Operating profit totaled $20.2 million, reflecting an 8.9% fall from the prior-year quarter. Operating margin in the fourth quarter contracted 82 bps to 8.1%.
Financial Update
Omnicell exited the full year with cash and cash equivalents of $485.9 million compared with $127.2 million at the end of 2019.
Cumulative cash flow from operating activities at the end of 2020 was $185.8 million compared with $145 million a year ago.
Q1 and 2021 Guidance
Omnicell noted that its customers resumed their pre-COVID purchasing patterns. The company also stated that its customers are still navigating the impact of COVID-19 and are in dire need for the company’s medication management automation solutions more strategically.
Based on this assumption, the company is confident about its outlook for 2021. For the first quarter of 2021, Omnicell expects revenues between $243 million and $248 million. The Zacks Consensus Estimate for the metric is pegged at $243.8 million.
Product revenues are forecasted between $171 million and $174 million while service revenues are projected within $72-$74 million for the quarter.
First-quarter adjusted EPS is envisioned in the band of 64-69 cents. The Zacks Consensus Estimate for the same is pegged at 53 cents.
For the full year, the company expects product bookings between $1.09 billion and $1.15 billion. Revenues are estimated between $1.08 billion and $1.10 billion.
For 2021, the anticipated ranges for product and service revenues are $770-$785 million and $315-$320 million, respectively.
Full-year adjusted earnings per share is expected between $3.40 and $3.60 for 2021. The Zacks Consensus Estimate for the metric stands at $3.29.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision. The consensus estimate has shifted 63.33% due to these changes.
VGM Scores
At this time, Omnicell has a strong Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Omnicell has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.