Back to top

Image: Bigstock

Myriad Genetics (MYGN) Q4 Earnings Lag Estimates, Revenues Up

Read MoreHide Full Article

Myriad Genetics, Inc. (MYGN - Free Report) reported adjusted earnings per share (EPS) of 41 cents in the fourth quarter of fiscal 2019, down 4.7% (5%) year over year. Adjusted EPS also lagged the Zacks Consensus Estimate by 12.8%.

On a reported basis, loss per share was 6 cents, showing a sharp decline from the year-ago earnings of 20 cents a share.

For the full year, adjusted EPS came in at $1.67, representing a 17.6% rise from the year-earlier period. However, the number lagged the Zacks Consensus Estimate by 4%.

Revenues

Total revenues were up 11.1% year over year to $215.4 million in the quarter under review. The figure, however, missed the Zacks Consensus Estimate by 2.9%.

Fiscal year 2019 revenues of $851.1 million increased from $743.7 million (up 14.4%). However, revenues fell short of the consensus estimate of $857.33 million by 0.7%.

Myriad Genetics, Inc. Price, Consensus and EPS Surprise

 

Quarter in Detail

Segment-wise, Molecular diagnostic tests recorded total revenues of $196.9 million, up 9% year over year.

Within this segment, Hereditary Cancer testing revenues remained marginally flat year over year, at $ 119.1 million. EndoPredict testing revenues increased 11.1% year over year to $3 million in the quarter under review. Vectra testing revenues were $12.2 million, down 19.2% year over year while other testing revenues declined 40.7% to $1.6 million. Further, GeneSight testing revenues fell 12.4% year over year to $29.8 million in the reported quarter. Prolaris tests raked in revenues of $6.3 million, down 10% year over year. Prenatal testing revenues came in at $25 million.

Pharmaceutical and clinical service revenues in the quarter under review totaled $18.5 million, reflecting a year-over-year increase of 39.1%.

Margin Trends

Gross margin in the quarter under review expanded 8 basis points (bps) to 76.5%. Research and development (R&D) expenses rose 18.1% year over year (to $20.9 million) along with a 33.2% increase in selling, general and administrative (SG&A) expenses (to $149.8 million) in the reported quarter. Adjusted operating loss was $6 million, reflecting a sharp contraction from the year-ago adjusted operating profit of $18 million.

Financial Position

Myriad Genetics exited fiscal 2019 with cash, cash equivalents and marketable securities of $136.9 million compared with $180.6 million at the end of the preceding year. For the full year, net cash provided by operating activities came in at $83.7 million compared with $115.9 million a year-ago (a 27.8% decline).

2020 Guidance

Myriad Genetics has issued the guidance for fiscal 2020 revenues. The company expects fiscal 2020 revenues within $865-$875 million. The Zacks Consensus Estimate for the metric is pegged at $922.9 million, higher than the projection.

On the bottom-line front, the company expects adjusted EPS in the band of $1.80-$1.90. The current consensus estimate for the metric is $1.93, which lies above the current projection.

Management has also provided the guidance for the first quarter of fiscal 2020. The company estimates adjusted EPS in the range of 30-32 cents and total revenues of $200-$202 million. The Zacks Consensus Estimate for adjusted EPS stands at 43 cents, above the company’s guided figure. Our consensus estimate for revenues is $219.9 million, below the company’s guided figure.

Our View

Myriad Genetics exited fourth-quarter fiscal 2020 on a mixed note. While the quarterly numbers lagged the Zacks Consensus Estimate, the company observed strong year-over-year revenue growth in EndoPredict. Pharmaceutical and clinical service segments witnessed an upside in the revenue section. The diversified product range constitutes 75% of overall volume. We are upbeat about Myriad Genetics’ ongoing volume growth and expanding reimbursement. The expansion of gross margin in the reported quarter also raises optimism.

On the flip side, the company saw a decline in Hereditary Cancer, GeneSight, Vectra, Prolaris as well as Other testing revenues.

Zacks Rank & Key Picks

Myriad Genetics currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks with solid results this earnings season are Baxter International Inc. (BAX - Free Report) , Haemonetics Corporation (HAE - Free Report) and LeMaitre Vascular, Inc. (LMAT - Free Report) . You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Baxter, holding a Zacks Rank #2 (Buy), delivered first-quarter 2020 adjusted EPS of 89 cents, beating the Zacks Consensus Estimate by 9.9%. Revenues of $2.84 billion also surpassed the consensus estimate by 1.9%.

Haemonetics, holding a Zacks Rank #1, reported adjusted EPS of 81 cents in the first quarter of 2020, beating the Zacks Consensus Estimate of 63 cents by 28.6%. Revenues came in at $238.5 million and marginally surpassed the consensus estimate of $238 million.

LeMaitre Vascular, holding a Zacks Rank #1, posted second-quarter 2019 adjusted EPS of 23 cents, which exceeded the Zacks Consensus Estimate of 21 cents. Also, revenues of $29.5 million beat the consensus mark of $29 million by a narrow margin.

Looking for Stocks with Skyrocketing Upside?

Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.

Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.

See the pot trades we're targeting>>