Exact Sciences (EXAS) to Post Q4 Earnings: What's in Store?
Exact Sciences Corporation EXAS is set to report fourth-quarter and full-year 2021 results on Feb 22, after the closing bell.
In the last-reported quarter, the company reported net loss of 97 cents, which was wider than the Zacks Consensus Estimate of a loss of 89 cents. The company has surpassed earnings estimates on two occasions and missed in the other two, delivering an average surprise of 20.8%.
Let’s take a look at how things have shaped up prior to this announcement.
Factors at Play
Exact Sciences’ Screening arm has been benefitting from the uptick in new orders for Cologuard from healthcare providers as well as strong contributions from Cologuard rescreening in the 45-49 age group. We expect this trend to have continued in the to-be-reported quarter as Cologuard’s covered lives for the 45-49 age group increased to 70% in the third quarter. Additionally, the expansion of the company’s primary care sales team in the prior quarter is likely to have boosted Cologuard adoption further.
Exact Sciences Corporation Price and EPS Surprise
Exact Sciences Corporation price-eps-surprise | Exact Sciences Corporation Quote
Per the third-quarter earnings call, the company noted that order growth accelerated in October 2021 amid a decline in Delta cases and improving in-person sales access. This is likely to have contributed to the fourth-quarter top line. However, the company anticipates the fourth quarter to be affected by fewer orders and a temporary delay in patients returning Cologuard kits during the holiday season. This has led the company to lower its screening revenue assumption in the range of $1.05-$1.055 billion for the fourth quarter. We are also vigilant about the impact of the resurgence in the Omicron variant cases on Cologuard orders.
Nonetheless, the Zacks Consensus Estimate for Screening revenues is pinned at 271 million, indicating 8.5% growth from the year-ago figure.
The Precision Oncology segment is likely to have been driven by growing Oncotype DX uptake in the United States and internationally, with the latest regulatory approval for Oncotype DX in Japan during the third quarter. The successful integration of new tests into the Precision Oncology platform in the prior quarter, which bolstered the company’s sequencing, bioinformatics and proteomics capabilities, is anticipated to have had a positive impact on the to-be-reported quarter’s performance as well.
In November 2021, Exact Sciences reported findings from a study that strongly supports the clinical use of the Oncotype DX Genomic Prostate Score (GPS) test. Meanwhile, in December 2021, the company reported findings from RxPONDER (Rx for Positive Node, Endocrine Responsive Breast Cancer) trial, which demonstrated that guiding treatment with Oncotype DX test can spare the use of chemotherapy in the majority of postmenopausal women. These positive findings backing the Oncotype DX tests are likely to have enhanced their adoption during the fourth quarter, contributing to the quarter’s top line.
Further, Exact Sciences reported clinical data in the third quarter that validated the use of ONCOGUARD liver to detect early-stage liver cancer reliably. This is anticipated to have had a beneficial impact on the to-be-reported quarter’s performance.
The Zacks Consensus Estimate for Precision Oncology revenues is pegged at 141 million, indicating 19.9% growth from the year-ago reported number.
Q4 Estimates
The Zacks Consensus Estimate for the company’s fourth-quarter 2021 revenues is pegged at $454.8 million, suggesting a decline of 2.5% from the year-ago reported figure.
The Zacks Consensus Estimate for its fourth-quarter 2021 net loss stands at 91 cents, suggesting a significantly wider loss than the year-ago net loss of 9 cents.
What Our Model Suggests
Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has higher chances of beating estimates. However, this is not the case here as you can see:
Earnings ESP: The company has an Earnings ESP of +10.50%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #4 (Sell).
Stocks Worth a Look
Here are a few stocks worth considering, as these have the right combination of elements to beat on earnings this reporting cycle.
AMN Healthcare Services, Inc. AMN has an Earnings ESP of +10.29% and a Zacks Rank of #1. The company is slated to release fourth-quarter and full-year 2021 results on Feb 17. You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcare’s long-term earnings growth rate is estimated at 16.2%. AMN’s earnings yield of 6.6% compares favorably with the industry’s 0.7%.
Allscripts Healthcare Solutions, Inc. MDRX has an Earnings ESP of +5.38% and a Zacks Rank of #2. Allscripts will release fourth quarter and full-year 2021 results on Feb 24.
Allscripts’ long-term earnings growth rate is estimated at 11.1%. MDRX’s earnings yield of 5% compares favorably with the industry’s (5%).
Henry Schein, Inc. HSIC has an Earnings ESP of +0.83% and a Zacks Rank of 2. The company will report fourth quarter and full-year 2021 results on Feb 15.
Henry Schein’s long-term earnings growth rate is estimated at 11.8%. HSIC’s earnings yield of 6.1% compares favorably with the industry’s 4.3%.
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