Back to top

Image: Bigstock

Why Is Myriad (MYGN) Down 1% Since Last Earnings Report?

Read MoreHide Full Article

It has been about a month since the last earnings report for Myriad Genetics (MYGN - Free Report) . Shares have lost about 1% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Myriad 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 drivers.

Myriad Genetics Q4 Earnings Top Estimate, Margins Down

Myriad Genetics reported adjusted earnings per share of 4 cents per share in the fourth quarter of 2023 versus the year-ago quarter’s loss of 12 cents. The metric surpassed the Zacks Consensus Estimate of 2 cents by 100%.

The quarter’s adjustments exclude amortization expenses from acquired intangible assets, equity compensations and real estate optimization.

The GAAP loss was 36 cents compared with the prior-year quarter’s loss of 52 cents.

For the full year, the adjusted loss was 27 cents per share compared with the year-ago period’s loss of 30 cents. The metric was narrower than the Zacks Consensus Estimate of a loss of 30 cents.

Revenues

Total revenues rose 10.6% year over year to $196.6 million in the quarter under review. The figure topped the Zacks Consensus Estimate by 1.2%.

Testing volumes rose 35% year over year, excluding contributions from the SneakPeek Early Gender DNA Test.

Total revenues for 2023 were $753 million, reflecting an 11% rise from the year-ago period. The figure topped the Zacks Consensus Estimate by 0.3%.

Quarter in Detail

Hereditary Cancer testing revenues rose 5% year over year to $88.9 million.

Pharmacogenomics testing revenues were $35.6 million, up 11% year over year.

Tumor Profiling testing revenues were up 1% year over year to $32.1 million.

Prenatal testing revenues came in at $40 million, up 37% year over year.

Margin Trends

The gross margin in the quarter under review contracted 102 basis points (bps) to 68.7%.

Research and development expenses fell 10.3% year over year to $21 million. SG&A expenses fell 0.8% to $145.4 million in the reported quarter.

The adjusted operating loss in the quarter was $31.4 million compared with the adjusted operating loss of $46 million in the year-ago quarter.

Financial Position

Myriad Genetics exited 2023 with cash and cash equivalents of $132.1 million compared with $56.9 million at the end of 2022. At the end of 2023, the long-term debt was $38.5 million compared with no debt at the end of 2022.

The cumulative net cash used in operating activities at the end of 2023 was $110.9 million compared with the year-ago cumulative net operating cash outflow of $106.3 million.

2024 Guidance

Myriad Genetics raised its 2024 revenue guidance and introduced EPS guidance.

The company raised its revenue guidance, which is now expected in the range of $820-$840 million, suggesting a 9-11% growth over 2023 revenue (the previous guidance was $815-$835 million). The Zacks Consensus Estimate for the same is pegged at $820.5 million.

Adjusted EPS is expected to be in the range of break-even to 5 cents. The Zacks Consensus Estimate for the same is pegged at 1 cent.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month.

The consensus estimate has shifted -92.31% due to these changes.

VGM Scores

Currently, Myriad has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. Following the exact same course, 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 indicates a downward shift. Notably, Myriad has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Myriad belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Fate Therapeutics (FATE - Free Report) , has gained 2.8% over the past month. More than a month has passed since the company reported results for the quarter ended December 2023.

Fate Therapeutics reported revenues of $1.68 million in the last reported quarter, representing a year-over-year change of -96.2%. EPS of -$0.45 for the same period compares with -$0.58 a year ago.

Fate Therapeutics is expected to post a loss of $0.48 per share for the current quarter, representing a year-over-year change of -152.6%. Over the last 30 days, the Zacks Consensus Estimate has changed +7.8%.

Fate Therapeutics has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Myriad Genetics, Inc. (MYGN) - free report >>

Fate Therapeutics, Inc. (FATE) - free report >>

Published in