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HOLX Stock Gains on FDA & CE Approval for Automated Molecular GI Tests

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Key Takeaways

  • Hologic gained FDA clearance and CE marking for its Panther Fusion GI bacterial assays.
  • HOLX shares climbed 1.3% to $67.91 after the approval of the new diagnostic tests.
  • Hologic's assays detect major GI pathogens, offering faster, more tailored patient testing.

Hologic, Inc. (HOLX - Free Report) recently received FDA 510(k) clearance for its Panther Fusion Gastrointestinal (GI) Bacterial and Expanded Bacterial Assays. Additionally, the assays obtained CE marking in the European Union in accordance with the In Vitro Diagnostic Regulation.

These highly sensitive molecular tests are designed to rapidly detect the most common bacterial pathogens responsible for infectious gastroenteritis.

Likely Trend of HOLX Stock Following the News

Following the announcement, shares of the company surged 1.3% to $67.91 yesterday.

The company’s Molecular Diagnostics assays, which run on Panther and Panther Fusion systems, remain the principal revenue-generating component in the Diagnostics division. A key catalyst for Diagnostics’ sustained growth is the expanding global installed base of Panther instruments. Accordingly, we expect the latest development to bolster investor confidence and maintain an upward momentum in HOLX's share price in the upcoming days.

Hologic currently has a market capitalization of $15.10 billion. The company’s earnings yield of 6.7% compares favorably to the industry’s -4.3%. It delivered an average earnings surprise of 0.96% for the trailing four quarters.

More on Hologic’s New Assays

Traditionally, identifying pathogens causing severe diarrheal illness has required the combination of culture, biochemical and microscopy-based tests, which can be labor-intensive, time-consuming and less sensitive than molecular methods. Hologic’s new GI pathogen detection tests leverage rapid molecular technology and cover common bacterial causes of infectious gastroenteritis, including Salmonella, Campylobacter, Shigella, E. coli (including O157), Vibrio, Yersinia and Plesiomonas, and can be run together or in any combination. 

In this customizable mini-panel format, the new assays allow testing to be specific and tailored to patients’ needs. This approach also helps reduce testing, streamline lab processes and accelerate time to diagnosis and clinical management. In the long term, it supports antimicrobial stewardship by enabling the judicious use of antibiotics. 

Testing of the Panther Fusion GI Bacterial and Expanded Bacterial Assays is performed using Hologic’s trusted Panther Fusion System, an addition to the Panther System. 

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About HOLX’s Panther and Panther Fusion Systems

The Panther System is a best-in-class, fully automated sample-to-result molecular diagnostics platform suitable for use in low, medium, or high-throughput laboratories. With a small footprint, adaptable workflow options, and a consolidated testing menu, it provides testing for women’s health, sexually transmitted infections, respiratory infections, viral load, transplant viruses, and now infectious gastroenteritis. The Panther Fusion module provides an expanded and growing in vitro diagnostics menu, as well as Open Access functionality, to run laboratory-developed tests. 

Industry Prospects Favor HOLX

Infectious gastroenteritis, caused by bacteria, viruses, or parasites, can range from mild to severe. Per researchers, in the United States alone, it is estimated that nearly 200 million cases occur annually, including up to 3 million that require ambulatory visits. Per analysts, foodborne outbreaks across Europe have resulted in the highest numbers of related hospitalizations and deaths recorded in a decade, with Salmonella accounting for the largest proportion of cases. 

Per a report by Persistence Market Research, the global gastrointestinal infection testing market is predicted to reach a size of $467.2 million by 2025. It is anticipated to witness a CAGR of 5.2% during the period to attain a value of $617.7 million by 2032.

Another Development by HOLX

Hologic unveiled favorable data from two groundbreaking studies evaluating its AI-powered mammography technology, the Genius AI Detection solution, at the European Society of Breast Imaging Annual Scientific Meeting in Aberdeen, Scotland. Research suggests that artificial intelligence may aid in identifying more aggressive forms of breast cancer and demonstrate performance comparable to that of expert radiologists in screening.

HOLX Stock Price Performance

In the past year, Hologic’s shares have risen 18.9% compared with the industry’s 2.3% growth.

HOLX’s Zacks Rank & Key Picks

Hologic currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space are Masimo (MASI - Free Report) , Phibro Animal Health (PAHC - Free Report) and Boston Scientific (BSX - Free Report) . While Masimo and Phibro sport a Zacks Rank #1 (Strong Buy) each, Boston Scientific carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Masimo’s shares have jumped 18.9% in the past year. MASI’s earnings beat estimates in each of the trailing four quarters, the average surprise being 13.8%. 

Shares of Phibro have surged 76.5% in the past year compared with the industry’s 3.4% growth. PAHC’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 27.9%.

Shares of Boston Scientific have rallied 16.7% in the past year compared with the industry’s 5.2% growth. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.1%.

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