Hologic (HOLX) to Report Q3 Earnings: What's in the Cards?
Hologic, Inc. HOLX is slated to report third-quarter fiscal 2023 results on July 31, after the closing bell.
In the last reported quarter, the company’s earnings of $1.06 per share surpassed the Zacks Consensus Estimate by 20.5%. Its earnings surpassed the consensus estimate in each of the trailing four quarters, the average surprise being 27.32%.
Let’s see how things have shaped up prior to the announcement.
Factors at Play
Diagnostics
In third-quarter fiscal 2023, Hologic is expected to have witnessed growth in the Diagnostics business (excluding COVID) from the growing adoption of Panther instruments and an expanded Panther installed base. The company’s expanded global installed base of more than 3,250 Panthers represents the catalyst for the division's sustained growth. The superior workflow of Panther combined with a broad menu of nearly 20 FDA-approved assays across Panther and Panther Fusion systems, creates tremendous value for customers and differentiates it from competitors. We believe these growth catalysts to have driven the company’s performance in Q3.
Molecular Diagnostics is likely to have registered strong growth in the third quarter, driven by Aptima BV and CV/TV vaginitis panel and aided by the core STI menu, including Clemidiagonrhia, HPV and Trich. In May 2023, Hologic received the FDA 510(k) clearance for the company’s Panther Fusion SARS-CoV-2/Flu A/B/RSV assay. We believe this development to have contributed to the company’s fiscal third-quarter performance.
Similar to the last reported quarter, Diagnostics business is expected to decline globally compared with the prior year’s levels due to significantly lower COVID testing.
Per our model, Hologic’s Diagnostic’s business revenues are projected at $501 million in Q3, a 10.5% decline year over year.
Breast Health
In the past few quarters, semiconductor chip availability continues to improve, allowing the delivery of more gantries than planned. Further, exceptional demand for the clinically differentiated mammography instruments remains high. We believe these trends to have continued in the fiscal third quarter as well.
Hologic’s strong backlog, the launch of new software products based on its investments in artificial intelligence and strength in its disposable portfolio such as Brevera, biopsy needles and Somatex Tumark markers are expected to have boosted HOLX’s revenues in the to-be-reported quarter.
Hologic, Inc. Price and EPS Surprise
Hologic, Inc. price-eps-surprise | Hologic, Inc. Quote
Per our model, Hologic’s Breast Health’s business revenues are projected at $294.9 million for the fiscal third quarter, up 4.3% year over year.
GYN Surgical
Similar to the last reported quarter, Hologic’s GYN Surgical is expected to have registered strong contributions from hysteroscopic portfolio of MyoSure the Fluent fluid management system and NovaSure. Through Acessa and Bolder aquisitions, the company integrated Acessa’s procedure and the Bolder’s advanced vessel sealing portfolio in its product line. Acessa is a unique radio frequency fibroid removal solution forming a new market. With Boulder, the company is entering an underdeveloped market by deploying its large surgical sales force. We believe these strategic efforts to have contributed to the company’s top line in the fiscal third quarter.
However, we note that, similar to industry-wide trends, Hologic’s surgical business is likely to have impacted by staffing shortages, which reduced hospital capacity, and choppy market conditions due to persistent foreign exchange impact are concerns. Moreover, Hologic’s mammography, related products and subsystems compete on a worldwide basis with products offered by a number of competitors which is expected to have impacted company’s sales in the quarter to be reported.
Per our model, Hologic’s GYN Surgical’s business revenues are projected at $132.6 million in the said quarter, suggesting a 4% decline year over year.
The Estimate Picture
The Zacks Consensus Estimate for total fiscal third-quarter revenues of $956.5 million suggests a decline of 4.6% from the prior-year quarter’s figure.
The consensus estimate for earnings per share is pegged at 88 cents, indicating a decline of 7.4% from the year-ago reported figure.
What Our Model Suggests
Our proven model does not conclusively predict an earnings beat for Hologic this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. However, this is not the case here.
Earnings ESP: Hologic has an Earnings ESP of -2.59%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Hologic currently carries a Zacks Rank #2.
Stocks Worth a Look
TG Therapeutics TGTX has an Earnings ESP of +12.00% and a Zacks Rank of #2. The company is expected to release second-quarter 2023 results soon. You can see the complete list of today’s Zacks #1 Rank stocks here.
TG Therapeutics has an expected earnings growth rate of 37.7% for 2023. TGTX’s 2023 projected revenues of $87.65 million indicate a massive increase from the year-ago reported figure of $2.8 million.
Dentsply Sirona XRAY has an Earnings ESP of +3.39% and a Zacks Rank of #2. Dentsply Sirona is scheduled to release second-quarter fiscal 2023 results on Aug 3.
XRAY’s earnings surpassed estimates in two of the trailing four quarters and missed the same in the other, the average beat being 10.47%. XRAY’s long-term expected growth rate is estimated to be 9.3%.
SiBone SIBN has an Earnings ESP of +1.21% and a Zacks Rank #2. SiBone is scheduled to release second-quarter 2023 results on Aug 7.
SIBN’s earnings surpassed estimates in three of the trailing four quarters and missed the same once, with the average surprise being 11.11%. The Zacks Consensus Estimate for SIBN’s second-quarter EPS indicates a 22.2% improvement from the year-ago reported figure.
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