Back to top

Image: Shutterstock

Here's Why You Should Invest in Haemonetics (HAE) Right Now

Read MoreHide Full Article

Haemonetics Corporation (HAE - Free Report) has been gaining from the impressive performance of the Plasma and Hospital businesses, with continued strength in the Hemostasis Management product line. Robust contributions from the Vascular Closure business also seem promising.

In the past year, the company’s shares have outperformed its industry. The stock has gained 33.9% against the industry’s 31.2% fall. Also, the company outperformed the S&P 500’s 4.7% rise.

This renowned global provider of blood management solutions to customers encompassing blood and plasma collectors and hospitals has a market cap of $4.21 billion. The company has an earnings growth rate of 10% for the next five years.

With solid prospects, this Zacks Rank #1 (Strong Buy) stock is an attractive pick for investors at the moment.

What Makes the Stock an Attractive Pick?

Potential Upsides of Plasma Franchise: Haemonetics is witnessing strong growth in Plasma franchise for quite some time. In the global plasma market, Haemonetics holds 80% share approximately.  Haemonetics is currently witnessing plasma market growth above historic rates driven by an industry striving to double collections by 2025 and the rising demand for plasma-based medicines. The company continued to benefit from the NexSys device and NexLynk donor management software (DMS), backed by increased customer adoptions.

Plasma revenues increased 31% in the fourth quarter, driven by volume growth and price benefits. North America disposables contributed 85% to Plasma revenues in fiscal 2023, up 33% in the fourth quarter. It was a historic year as plasma fractionators strove to replenish safety stocks that were dangerously depleted during the pandemic. As a result, Haemoentics saw record collection volumes throughout the year.

Huge Potential of Hemostasis Management Franchise: Under the Hospital business, Hemostasis Management saw strong growth in the past few quarters.

Hemostasis Management revenues grew 22% in the reported quarter. Growth in North America, the company’s largest market delivered double-digit growth in the fourth quarter. Global growth was driven by the strong adoption and utilization of TEG disposables in both periods.

The recently-acquired Vascular Closure business continues to excel, with revenues increasing 31% in the fiscal fourth quarter. Growth in the fourth quarter was led by opening new accounts and driving penetration to gain share in the top U.S. EP hospitals.

Zacks Investment ResearchImage Source: Zacks Investment Research

International commercialization of VASCADE is underway, utilizing hybrid sales models and leveraging existing back-office infrastructure.

Transfusion Management revenues rose 8% in the fourth quarter. The upside was driven by the expansion of its sales force and software implementations in the United States and the U.K.

Upbeat Guidance: For 2024, the company expects total GAAP revenue growth in the range of 4-7% on a reported basis. Organic revenue growth is anticipated to be 5-8%. The Zacks Consensus Estimate for fiscal 2024 revenues is pegged at $1.19 billion.

HAE expects the full-year adjusted earnings per share in the band of $3.45-$3.75. The Zacks Consensus Estimate for the same is pegged at $3.29.

Estimate Trend

In the past 90 days, the Zacks Consensus Estimate for Haemonetics’ 2024 earnings moved 7.9% north to $3.55.

The Zacks Consensus Estimate for 2024 revenues is pegged at $1.25 billion, suggesting a 6.6% rise from the year-ago reported number.

Other Key Picks

Some other top-ranked stocks in the broader medical space are Addus Homecare Corporation (ADUS - Free Report) , Merit Medical Systems, Inc. (MMSI - Free Report) and Hologic, Inc. (HOLX - Free Report) .

The Zacks Consensus Estimate for Addus Homecare’s 2023 earnings indicates 10.9% year-over-year growth. The Zacks Consensus Estimate for ADUS’s 2023 earnings has moved 0.5% north in the past 30 days.

Addus Homecare has a long-term estimated growth rate of 11.8%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Merit Medical reported a first-quarter 2023 adjusted EPS of 64 cents, beating the Zacks Consensus Estimate by 16.4%. Revenues of $297.6 million surpassed the Zacks Consensus Estimate by 5.9%. It currently carries a Zacks Rank #2.

Merit Medical has a long-term estimated growth rate of 11%. MMSI’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 20.2%.

Hologic, carrying a Zacks Rank #2 (Buy) at present, has an estimated growth rate of 5.1% for fiscal 2024. HOLX’s earnings surpassed estimates in all the trailing four quarters, the average being 27.3%.

Hologic has gained 5% against the industry’s 2.2% decline in the past year.

Published in