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Why Is Pacific Biosciences (PACB) Down 13.6% Since Last Earnings Report?
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A month has gone by since the last earnings report for Pacific Biosciences of California (PACB - Free Report) . Shares have lost about 13.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Pacific Biosciences due for a breakout? 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.
PacBio’s Q4 Earnings Miss Estimates, Revenues Top
PacBio delivered adjusted loss per share of 30 cents in the fourth quarter of 2021, wider than the year-ago loss of 12 cents per share. The figure was also wider than the Zacks Consensus Estimate of a loss of 28 cents per share.
The company’s GAAP loss per share was 31 cents in the quarter against the year-ago earnings per share of 37 cents.
Full-year adjusted loss was 93 cents per share, wider than the year-ago loss of 62 cents. The metric was also wider than the Zacks Consensus Estimate of a loss of 86 cents per share.
Revenues in Detail
PacBio registered revenues of $36 million in the fourth quarter, up 32.7% year over year. The figure marginally surpassed the Zacks Consensus Estimate by 0.1%.
The year-over-year uptick was partly driven by robust consumable and instrument sales.
Sequentially, the top line improved 3%.
Full-year revenues were $130.5 million, reflecting a 65.4% improvement from the year-ago period. The metric was in line with the Zacks Consensus Estimate.
Segmental Analysis
Product revenues amounted to $31.2 million, up 31.9% from the prior-year quarter.
PacBio placed 48 Sequel II/IIe systems during the fourth quarter of 2021 compared to 35 Sequel II systems placed in the year-ago quarter. This brings the total installed base of Sequel II/IIe systems to 374 as of Dec 31, 2021 compared with 203 as of Dec 31, 2020.
Instrument revenues for the fourth quarter of 2021 were $16.2 million, up 19.1% year over year.
Consumables revenues for the fourth quarter of 2021 were $15 million, up 50% from the prior-year quarter.
Service and Other Revenues came in at $4.9 million, up 38.2% year over year.
Margin Trend
In the quarter under review, PacBio’s adjusted gross profit rose 48.7% to $16.9 million. Adjusted gross margin expanded 504 basis points (bps) to 47.1%.
Sales, general and administrative expenses rose 107.9% to $37.3 million. Research and development expenses surged 144.3% year over year to $42.6 million. Adjusted total operating expenses of $79.9 million surged 125.8% year over year.
Adjusted total operating loss totaled $62.9 million in the reported quarter compared with the prior-year quarter’s adjusted total operating loss of $23.9 million.
Financial Position
PacBio exited full-year 2021 with cash, cash equivalents and investments (excluding short and long-term restricted cash) of $1.04 billion compared with $318.8 million at the end of 2020.
Guidance
PacBio has initiated its financial outlook for first quarter and full-year 2022.
The company expects its revenues for 2022 to be in the range of $160-$170 million, representing 23-30% growth from the comparable reported figure of 2021. The Zacks Consensus Estimate for the same is currently pegged at $182.3 million.
For the first quarter of 2022, PacBio expects revenues to be in the band of $31-$34 million, reflecting a 12% growth on a year-over-year basis at the midpoint. The Zacks Consensus Estimate for the same is currently pegged at $38.5 million.
The company has witnessed lower utilization in January, primarily due to the pandemic-induced impacts and associated quarantine, thereby slowing lab productivity and, in some cases, preventing lab access. Along with the pandemic, the recent macro environment has resulted in some potential delays in capital purchases in the first quarter, particularly in EMEA.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -19.75% due to these changes.
VGM Scores
Currently, Pacific Biosciences has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Pacific Biosciences has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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Why Is Pacific Biosciences (PACB) Down 13.6% Since Last Earnings Report?
A month has gone by since the last earnings report for Pacific Biosciences of California (PACB - Free Report) . Shares have lost about 13.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Pacific Biosciences due for a breakout? 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.
PacBio’s Q4 Earnings Miss Estimates, Revenues Top
PacBio delivered adjusted loss per share of 30 cents in the fourth quarter of 2021, wider than the year-ago loss of 12 cents per share. The figure was also wider than the Zacks Consensus Estimate of a loss of 28 cents per share.
The company’s GAAP loss per share was 31 cents in the quarter against the year-ago earnings per share of 37 cents.
Full-year adjusted loss was 93 cents per share, wider than the year-ago loss of 62 cents. The metric was also wider than the Zacks Consensus Estimate of a loss of 86 cents per share.
Revenues in Detail
PacBio registered revenues of $36 million in the fourth quarter, up 32.7% year over year. The figure marginally surpassed the Zacks Consensus Estimate by 0.1%.
The year-over-year uptick was partly driven by robust consumable and instrument sales.
Sequentially, the top line improved 3%.
Full-year revenues were $130.5 million, reflecting a 65.4% improvement from the year-ago period. The metric was in line with the Zacks Consensus Estimate.
Segmental Analysis
Product revenues amounted to $31.2 million, up 31.9% from the prior-year quarter.
PacBio placed 48 Sequel II/IIe systems during the fourth quarter of 2021 compared to 35 Sequel II systems placed in the year-ago quarter. This brings the total installed base of Sequel II/IIe systems to 374 as of Dec 31, 2021 compared with 203 as of Dec 31, 2020.
Instrument revenues for the fourth quarter of 2021 were $16.2 million, up 19.1% year over year.
Consumables revenues for the fourth quarter of 2021 were $15 million, up 50% from the prior-year quarter.
Service and Other Revenues came in at $4.9 million, up 38.2% year over year.
Margin Trend
In the quarter under review, PacBio’s adjusted gross profit rose 48.7% to $16.9 million. Adjusted gross margin expanded 504 basis points (bps) to 47.1%.
Sales, general and administrative expenses rose 107.9% to $37.3 million. Research and development expenses surged 144.3% year over year to $42.6 million. Adjusted total operating expenses of $79.9 million surged 125.8% year over year.
Adjusted total operating loss totaled $62.9 million in the reported quarter compared with the prior-year quarter’s adjusted total operating loss of $23.9 million.
Financial Position
PacBio exited full-year 2021 with cash, cash equivalents and investments (excluding short and long-term restricted cash) of $1.04 billion compared with $318.8 million at the end of 2020.
Guidance
PacBio has initiated its financial outlook for first quarter and full-year 2022.
The company expects its revenues for 2022 to be in the range of $160-$170 million, representing 23-30% growth from the comparable reported figure of 2021. The Zacks Consensus Estimate for the same is currently pegged at $182.3 million.
For the first quarter of 2022, PacBio expects revenues to be in the band of $31-$34 million, reflecting a 12% growth on a year-over-year basis at the midpoint. The Zacks Consensus Estimate for the same is currently pegged at $38.5 million.
The company has witnessed lower utilization in January, primarily due to the pandemic-induced impacts and associated quarantine, thereby slowing lab productivity and, in some cases, preventing lab access. Along with the pandemic, the recent macro environment has resulted in some potential delays in capital purchases in the first quarter, particularly in EMEA.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -19.75% due to these changes.
VGM Scores
Currently, Pacific Biosciences has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Pacific Biosciences has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.