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Here's Why You Should Add Lantheus (LNTH) to Your Portfolio
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Lantheus Holdings, Inc. (LNTH - Free Report) has been gaining from its focus on pipeline development. The optimism led by a solid fourth-quarter 2023 performance and strength in radiopharmaceuticals is expected to contribute further. However, dependence upon third parties and macroeconomic concerns are major downsides.
Over the past year, the Zacks Rank #1 (Strong Buy) stock has lost 2.5% against the 5.5% rally of the industry. The S&P 500 has witnessed 9.9% growth in the said time frame.
The renowned radiopharmaceutical-focused player has a market capitalization of $4.03 billion. The company projects 5.6% growth for 2024 and expects to witness continued improvements in its business. Lantheus’ earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average earnings surprise being 14.8%.
Image Source: Zacks Investment Research
Let’s delve deeper.
Pipeline Development: We are optimistic about Lantheus actively developing its pipeline with promising assets like PNT2002 and PNT2003. In December 2022, the company announced the closing of a set of collaborations with POINT Biopharma Global Inc. (“POINT”). This granted Lantheus exclusive worldwide rights (excluding Japan, South Korea, China including Hong Kong, Macau and Taiwan; Singapore and Indonesia) to co-develop and commercialize POINT’s PNT2002 and PNT2003 product candidates.
Strength in Radiopharmaceuticals: Lantheus has established itself as a leader in the radiopharmaceutical sector, particularly in prostate-specific membrane antigen (PSMA) positron emission tomography (PET) imaging, where its product, PYLARIFY, has a strong demand.
Based on estimates from third-party sources regarding the incidence of prostate cancer in men in the United States, Lantheus believes the market potential for PSMA PET imaging agents in the country could be up to 350,000 annual scans, comprising 125,000 scans for patients with an intermediate, unfavorable or high or very high risk of suspected metastases of prostate cancer and 195,000 scans for patients with suspected recurrence of prostate cancer, among others. Earlier this month, the FDA approved label expansion for DEFINITY (Perflutren Lipid Microsphere) as an ultrasound-enhancing agent for use in pediatric patients with suboptimal echocardiograms.
Strong Q4 Results: Lantheus’ fourth-quarter 2023 top-line and bottom-line performance was solid. Robust segmental results were also registered, with continued strength in PYLARIFY and DEFINITY. The expansion of gross margin was also seen.
Downsides
Macroeconomic Concerns: Lantheus’ operational and financial success are significantly influenced by various factors, many of which are outside its control. The current economic environment and financial market conditions present unpredictable challenges to the business. There is a risk of reduced demand for healthcare services and pharmaceuticals due to various factors, which could affect revenues. This, in turn, might result in delayed or canceled orders, hurting the company's financial stability and liquidity.
Dependence Upon Third Parties: PYLARIFY is produced by a network of PET manufacturing facilities (PMFs) across the nation, each requiring separate FDA approval. Despite ongoing efforts to qualify additional PMFs, there's uncertainty regarding the FDA's continued approvals and the PMFs' manufacturing capabilities, which could adversely impact Lantheus’ future operations and financial health.
Estimate Trend
Lantheus has been witnessing a positive estimate revision trend for 2024. Over the past 60 days, the Zacks Consensus Estimate for its earnings per share has moved 5.1% north to $6.58.
The Zacks Consensus Estimate for first-quarter 2024 revenues is pegged at $349 million.
Cardinal Health’s stock has surged 50.9% in the past year. Earnings estimates for Cardinal Health have risen from $7.28 to $7.29 in fiscal 2024 and from $8.02 to $8.04 in fiscal 2025 in the past 30 days.
CAH’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 15.6%. In the last reported quarter, it posted an earnings surprise of 16.67%.
Estimates for Stryker’s 2024 earnings per share have remained constant at $11.86 in the past 30 days. Shares of the company have moved 28.5% upward in the past year compared with the industry’s rise of 5.2%.
SYK’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 5.09%. In the last reported quarter, it delivered an average earnings surprise of 5.81%.
Estimates for DaVita’s 2024 earnings per share have moved up from $8.97 to $9.23 in the past 30 days. Shares of the company have surged 74.4% in the past year compared with the industry’s 22% rise.
DVA’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 35.57%. In the last reported quarter, it delivered an average earnings surprise of 22.22%.
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Here's Why You Should Add Lantheus (LNTH) to Your Portfolio
Lantheus Holdings, Inc. (LNTH - Free Report) has been gaining from its focus on pipeline development. The optimism led by a solid fourth-quarter 2023 performance and strength in radiopharmaceuticals is expected to contribute further. However, dependence upon third parties and macroeconomic concerns are major downsides.
Over the past year, the Zacks Rank #1 (Strong Buy) stock has lost 2.5% against the 5.5% rally of the industry. The S&P 500 has witnessed 9.9% growth in the said time frame.
The renowned radiopharmaceutical-focused player has a market capitalization of $4.03 billion. The company projects 5.6% growth for 2024 and expects to witness continued improvements in its business. Lantheus’ earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average earnings surprise being 14.8%.
Image Source: Zacks Investment Research
Let’s delve deeper.
Pipeline Development: We are optimistic about Lantheus actively developing its pipeline with promising assets like PNT2002 and PNT2003. In December 2022, the company announced the closing of a set of collaborations with POINT Biopharma Global Inc. (“POINT”). This granted Lantheus exclusive worldwide rights (excluding Japan, South Korea, China including Hong Kong, Macau and Taiwan; Singapore and Indonesia) to co-develop and commercialize POINT’s PNT2002 and PNT2003 product candidates.
Strength in Radiopharmaceuticals: Lantheus has established itself as a leader in the radiopharmaceutical sector, particularly in prostate-specific membrane antigen (PSMA) positron emission tomography (PET) imaging, where its product, PYLARIFY, has a strong demand.
Based on estimates from third-party sources regarding the incidence of prostate cancer in men in the United States, Lantheus believes the market potential for PSMA PET imaging agents in the country could be up to 350,000 annual scans, comprising 125,000 scans for patients with an intermediate, unfavorable or high or very high risk of suspected metastases of prostate cancer and 195,000 scans for patients with suspected recurrence of prostate cancer, among others. Earlier this month, the FDA approved label expansion for DEFINITY (Perflutren Lipid Microsphere) as an ultrasound-enhancing agent for use in pediatric patients with suboptimal echocardiograms.
Strong Q4 Results: Lantheus’ fourth-quarter 2023 top-line and bottom-line performance was solid. Robust segmental results were also registered, with continued strength in PYLARIFY and DEFINITY. The expansion of gross margin was also seen.
Downsides
Macroeconomic Concerns: Lantheus’ operational and financial success are significantly influenced by various factors, many of which are outside its control. The current economic environment and financial market conditions present unpredictable challenges to the business. There is a risk of reduced demand for healthcare services and pharmaceuticals due to various factors, which could affect revenues. This, in turn, might result in delayed or canceled orders, hurting the company's financial stability and liquidity.
Dependence Upon Third Parties: PYLARIFY is produced by a network of PET manufacturing facilities (PMFs) across the nation, each requiring separate FDA approval. Despite ongoing efforts to qualify additional PMFs, there's uncertainty regarding the FDA's continued approvals and the PMFs' manufacturing capabilities, which could adversely impact Lantheus’ future operations and financial health.
Estimate Trend
Lantheus has been witnessing a positive estimate revision trend for 2024. Over the past 60 days, the Zacks Consensus Estimate for its earnings per share has moved 5.1% north to $6.58.
The Zacks Consensus Estimate for first-quarter 2024 revenues is pegged at $349 million.
Lantheus Holdings, Inc. Price
Lantheus Holdings, Inc. price | Lantheus Holdings, Inc. Quote
Other Stocks to Consider
Some other top-ranked stocks in the broader medical space are Cardinal Health (CAH - Free Report) , Stryker (SYK - Free Report) and DaVita (DVA - Free Report) . While Cardinal Health and Stryker each carry a Zacks Rank #2 (Buy), DaVita sports a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Cardinal Health’s stock has surged 50.9% in the past year. Earnings estimates for Cardinal Health have risen from $7.28 to $7.29 in fiscal 2024 and from $8.02 to $8.04 in fiscal 2025 in the past 30 days.
CAH’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 15.6%. In the last reported quarter, it posted an earnings surprise of 16.67%.
Estimates for Stryker’s 2024 earnings per share have remained constant at $11.86 in the past 30 days. Shares of the company have moved 28.5% upward in the past year compared with the industry’s rise of 5.2%.
SYK’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 5.09%. In the last reported quarter, it delivered an average earnings surprise of 5.81%.
Estimates for DaVita’s 2024 earnings per share have moved up from $8.97 to $9.23 in the past 30 days. Shares of the company have surged 74.4% in the past year compared with the industry’s 22% rise.
DVA’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 35.57%. In the last reported quarter, it delivered an average earnings surprise of 22.22%.