A month has gone by since the last earnings report for Haemonetics (HAE - Free Report) . Shares have added about 9.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Haemonetics due for a pullback? 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 catalysts.
Haemonetics reported adjusted earnings per share (EPS) of 59 cents in the first quarter of fiscal 2019, a 78.9% surge year over year. The bottom line also surpassed the Zacks Consensus Estimate of 42 cents.
On a reported basis, Haemonetics incurred net loss of 5 cents per share against net income of 38 cents a year ago.
Revenues rose 8.7% year over year (up 7.2% at constant exchange rate or CER) to $229.3 million in the quarter under review. Moreover, the top line exceeded the Zacks Consensus Estimate of $220 million.
Revenues by Product Categories
At Plasma, reported revenues of $116.9 million (accounting for 50.9% of total revenues) were up 15.2% year over year (up 14% at CER).Plasma revenue growth in North America was 17.1% and included 15.3% growth in disposables along with strength in liquid solutions and software revenues.
Revenues at BloodCenter (28.1% of total revenues) dipped 1.7% (down 3.1% at CER) to $64.5 million.
Hospital revenues (contributing to 20.9% of total revenues) rose 9.3% (up 6.3% at CER) to $48 million.
Haemonetics’ first-quarter adjusted gross margin was 47.2%, up 370 basis points (bps) year over year on favorable mix and currency.
Adjusted operating income was $5.3 million in the quarter under discussion, showing a 68.1% plunge year over year. While adjusted operating margin contracted 557 bps year over year to 2.3%.
Haemonetics exited the first quarter of fiscal 2019 with cash and cash equivalents of $192.1 million compared with $180.2 million at fiscal 2018-end.
The company generated operating cash flow of $23.1 million in the fiscal first quarter compared with $38.4 million in the year-ago period. The company also reported free cash flow (before restructuring and turnaround costs) of $6 million during the same compared with $28.9 million a year ago.. Capital expenditures summed $27.3 million in the period, higher than $12.7 million in the prior year.
Fiscal 2019 Guidance
Haemonetics reaffirmed its fiscal 2019 revenue guidance at CER. The company expects full-year revenue growth of 3-5%. Coming to segmental revenues, Plasma revenue rise is expected in the 7-10% band while Hospital revenues are estimated to increase 5-8%. However, Blood Center revenues are likely to decline 3-6%. The Zacks Consensus Estimate for next-year revenues is pegged at $947.7 million.
The company still predicts 2019 adjusted EPS in the range of $2-$2.30. The consensus estimate of $2.24 is within this guided range.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
Currently, Haemonetics has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. However, 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 C. If you aren't focused on one strategy, this score is the one you should be interested in.
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Haemonetics has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.