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PacBio (PACB) Preliminary Q1 Revenues Dampened by Purchase Delays
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Pacific Biosciences of California, Inc. (PACB - Free Report) , popularly known as PacBio, recently announced preliminary revenues for first-quarter 2024. Despite the soft preliminary results, the company’s shares gained 7.1% in the pre-market trading session.
Per the preliminary report, first-quarter 2024 total revenues are estimated to be $38.8 million, down 0.3% year over year. The Zacks Consensus Estimate of $50 million lies above the preliminary figure.
The company’s instrument revenues are expected to be $19 million (down 8.2% year over year), while the consumables revenues are anticipated to be $16 million (up 14.3% year over year). Preliminary service and other revenues for the first quarter of 2024 are expected to be $3.8 million, down 9.5% year over year.
PacBio shipped 28 Revio sequencing systems for revenues during first-quarter 2024, thereby bringing the Revio installed base to 201 systems as of Mar 31, 2024. Of the 28 Revio systems shipped, 16 were shipped to new customers. Per management, Onso shipments increased sequentially as PacBio continued to ramp up its manufacturing capacity, achieving steady-state production levels at the end of the quarter.
Per management, the preliminary revenues for the first quarter were below the company’s expectations due to an increasing number of customers delaying instrument purchases and softness in consumable shipments. Management also stated that all regions underperformed, with 13 Revio systems falling out of the forecast in the last two weeks of the first quarter. PacBio believes this primarily resulted from elongated customer purchasing cycles. This raises our apprehension about the stock.
Guidance
PacBio has lowered its revenue outlook for the full year.
The company now expects its 2024 revenues in the range of $170 million-$200 million, down from the earlier provided guidance of $230 million-$250 million (representing a growth rate of 15-25% from 2023 figures). The Zacks Consensus Estimate is pegged at $237 million.
The company expects the total Revio shipments for 2024 to be around 120 systems.
PacBio expects its consumable revenues for 2024 to be around $80 million, while consumable pull-through on the Revio system will be around $290,000 per system.
The company expects to share more details on its outlook on its earnings call scheduled on May 9.
A Brief Q1 Analysis
At the time of the release of the preliminary first-quarter 2024 results, management stated that despite optimism regarding its growth prospects as PacBio entered 2024 following the successful launch of the Revio system and a record 2023, the revenues in the quarter were significantly lower than expected. Per management, during the last two weeks of the first quarter, there was an increasing number of customers delaying instrument purchases. The company also experienced some unexpected softness in consumable shipments. These factors, which led to the first quarter performing below PacBio’s original expectations, are expected to have an impact on its 2024 performance. This does not bode well for the stock.
However, PacBio is currently focused on improving commercial execution to drive adoption of both the Revio and Onso platforms, continuing the development of its benchtop long-read and high throughput short-read platforms and implementing projects to improve its gross margin and drive manufacturing efficiencies, among others. Management is also optimistic that its second-quarter revenues will improve over the first quarter and the second half of the year to improve sequentially as consumables return to sequential growth and the company closes some of the deals that were delayed in the first quarter. This raises our optimism about the stock.
The company’s preliminary projection of lower revenues despite strength in its consumables revenues raises apprehension about the stock.
Price Performance
Shares of the company have lost 61.8% between Jan 1 and Mar 31, 2024, against the industry’s 9.3% rise and the S&P 500’s 10.2% growth.
DaVita, carrying a Zacks Rank #2 (Buy), has an estimated long-term growth rate of 12.1%. DVA’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 35.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
DaVita has gained 31.8% compared with the industry’s 9.8% rise between Jan 1 and Mar 31, 2024.
Ecolab, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 13.3%. ECL’s earnings surpassed estimates in each of the trailing four quarters, with the average being 1.7%.
Ecolab has gained 16.4% compared with the industry’s 10.1% rise between Jan 1 and Mar 31, 2024.
Cencora, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 9.8%. COR’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 6.7%.
Cencora has gained 18.3% compared with the industry’s 7.9% rise between Jan 1 and Mar 31, 2024.
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PacBio (PACB) Preliminary Q1 Revenues Dampened by Purchase Delays
Pacific Biosciences of California, Inc. (PACB - Free Report) , popularly known as PacBio, recently announced preliminary revenues for first-quarter 2024. Despite the soft preliminary results, the company’s shares gained 7.1% in the pre-market trading session.
The company is scheduled to release first-quarter results on May 9.
Per the preliminary report, first-quarter 2024 total revenues are estimated to be $38.8 million, down 0.3% year over year. The Zacks Consensus Estimate of $50 million lies above the preliminary figure.
The company’s instrument revenues are expected to be $19 million (down 8.2% year over year), while the consumables revenues are anticipated to be $16 million (up 14.3% year over year). Preliminary service and other revenues for the first quarter of 2024 are expected to be $3.8 million, down 9.5% year over year.
PacBio shipped 28 Revio sequencing systems for revenues during first-quarter 2024, thereby bringing the Revio installed base to 201 systems as of Mar 31, 2024. Of the 28 Revio systems shipped, 16 were shipped to new customers. Per management, Onso shipments increased sequentially as PacBio continued to ramp up its manufacturing capacity, achieving steady-state production levels at the end of the quarter.
Per management, the preliminary revenues for the first quarter were below the company’s expectations due to an increasing number of customers delaying instrument purchases and softness in consumable shipments. Management also stated that all regions underperformed, with 13 Revio systems falling out of the forecast in the last two weeks of the first quarter. PacBio believes this primarily resulted from elongated customer purchasing cycles. This raises our apprehension about the stock.
Guidance
PacBio has lowered its revenue outlook for the full year.
The company now expects its 2024 revenues in the range of $170 million-$200 million, down from the earlier provided guidance of $230 million-$250 million (representing a growth rate of 15-25% from 2023 figures). The Zacks Consensus Estimate is pegged at $237 million.
The company expects the total Revio shipments for 2024 to be around 120 systems.
PacBio expects its consumable revenues for 2024 to be around $80 million, while consumable pull-through on the Revio system will be around $290,000 per system.
The company expects to share more details on its outlook on its earnings call scheduled on May 9.
A Brief Q1 Analysis
At the time of the release of the preliminary first-quarter 2024 results, management stated that despite optimism regarding its growth prospects as PacBio entered 2024 following the successful launch of the Revio system and a record 2023, the revenues in the quarter were significantly lower than expected. Per management, during the last two weeks of the first quarter, there was an increasing number of customers delaying instrument purchases. The company also experienced some unexpected softness in consumable shipments. These factors, which led to the first quarter performing below PacBio’s original expectations, are expected to have an impact on its 2024 performance. This does not bode well for the stock.
However, PacBio is currently focused on improving commercial execution to drive adoption of both the Revio and Onso platforms, continuing the development of its benchtop long-read and high throughput short-read platforms and implementing projects to improve its gross margin and drive manufacturing efficiencies, among others. Management is also optimistic that its second-quarter revenues will improve over the first quarter and the second half of the year to improve sequentially as consumables return to sequential growth and the company closes some of the deals that were delayed in the first quarter. This raises our optimism about the stock.
The company’s preliminary projection of lower revenues despite strength in its consumables revenues raises apprehension about the stock.
Price Performance
Shares of the company have lost 61.8% between Jan 1 and Mar 31, 2024, against the industry’s 9.3% rise and the S&P 500’s 10.2% growth.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
Currently, PacBio carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space are DaVita Inc. (DVA - Free Report) , Ecolab Inc. (ECL - Free Report) and Cencora, Inc. (COR - Free Report) .
DaVita, carrying a Zacks Rank #2 (Buy), has an estimated long-term growth rate of 12.1%. DVA’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 35.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
DaVita has gained 31.8% compared with the industry’s 9.8% rise between Jan 1 and Mar 31, 2024.
Ecolab, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 13.3%. ECL’s earnings surpassed estimates in each of the trailing four quarters, with the average being 1.7%.
Ecolab has gained 16.4% compared with the industry’s 10.1% rise between Jan 1 and Mar 31, 2024.
Cencora, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 9.8%. COR’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 6.7%.
Cencora has gained 18.3% compared with the industry’s 7.9% rise between Jan 1 and Mar 31, 2024.