It has been about a month since the last earnings report for Exact Sciences (EXAS Quick QuoteEXAS - Free Report) . Shares have lost about 22.5% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Exact Sciences due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Exact Sciences Q1 Earnings Top Estimates, Sales View Up

Exact Sciences reported first-quarter 2022 net loss of $1.04, much wider than the net loss of 18 cents in the year-ago period. However, the metric was narrower than the Zacks Consensus Estimate of a loss of $1.12.

Revenues in Detail

First-quarter consolidated revenues were $486.6 million, up 21% year over year. The metric exceeded the Zacks Consensus Estimate by 5.3%.

Segments in Detail

Screening revenues, including laboratory service revenues from Cologuard, PreventionGenetics, and immaterial revenues from Biomatrica products, were $306.5 million, reflecting a year-over-year increase of 27.5% driven by Cologuard volumes. In the quarter, 9,000 new healthcare providers ordered Cologuard.

Precision Oncology revenues, including laboratory service revenues from global Oncotype products, were $152.6 million, up 17.9% year over year.

Revenues from COVID-19 testing totaled $27.4million, down 15.2%year over year.

Margin

In the quarter under review, Exact Sciences’ gross profit (excluding the amortization of acquired intangibles) rose 20.5% to $351.9 million. Gross margin contracted 33 basis points (bps) to 72.3%.

Research and development expenses contracted 11.5% year over year to $102.2 million. Sales and marketing expenses increased 24.7% to $232.2 million. General and administrative expenses contracted 36.6% year over year to $169.8 million.

Adjusted operating expenses were $504.2 million in the first quarter, down 11.5% year over year. Adjusted operating loss totaled $152.3 million, narrower than the year-ago operating loss of $277.4 million.

Financial Update

Exact Sciences exited first-quarter 2022 with cash and cash equivalents, and marketable securities of $816.9 million compared with $1.03 billion at the end of 2021.

The company reported no long-term debt on its balance sheet at the end of first-quarter 2022.

2022 Outlook

The company now expects revenues in the range of $1,985-$2,032 million (an improvement from the earlier projected range of $1,975-$2,027 million) for 2022. The Zacks Consensus Estimate for the same is pegged at $2.01 billion.

For 2022, the company now expects Screening revenues in the range of $1,350-$1,372 million (earlier projection $1,340-$1,367 million). The company has reaffirmed its guidance for Precision Oncology revenues at the band of $595-$610 million. The company has also maintained its outlook for COVID-19 testing revenues at the band of $40-$50 million.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates.

VGM Scores

At this time, Exact Sciences has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. 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 looks promising. Notably, Exact Sciences has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.