What's in Store for Option Care Health (OPCH) in Q3 Earnings?
Option Care Health, Inc. OPCH is scheduled to report third-quarter 2023 results on Oct 25, before market open.
In the last reported quarter, the company’s earnings per share (EPS) of 63 cents surpassed the Zacks Consensus Estimate by 186.4%. Over the trailing four quarters, its earnings outperformed the Zacks Consensus Estimate on three occasions and broke even once, delivering an earnings surprise of 57%, on average.
Let’s see how things have shaped up prior to this announcement.
Factors to Note
On the second quarter of 2023 earnings call in July, management confirmed that over the quarter, Option Care Health continues to be active on the business development front. It announced a new collaboration with Krystal Biotech (in May) and is currently preparing for potential emerging therapies to treat neurological disorders, such as Alzheimer's.
Management also stated that its partnership with Krystal Biotech is likely to have enabled the company to help provide a new and innovative gene therapy treatment for patients suffering from dystrophic epidermolysis bullosa.
Option Care Health, Inc. Price and EPS Surprise
Option Care Health, Inc. price-eps-surprise | Option Care Health, Inc. Quote
On the same call, Option Care Health’s management confirmed the recent receipt of the FDA’s approval of Leqembi. Management believes that this regulatory clearance will enable it to remain closely connected to patients, pharma providers and payers to help ensure that Option Care Health is part of the solution to a potential innovative category of new therapies. These look promising for the stock during the third quarter of 2023.
The strong utilization, reflecting Option Care Health’s efforts to be a partner of choice for its referral sources, observed by management during the second quarter of 2023 is likely to have continued in the third quarter. This is expected to have contributed to the to-be-reported quarter’s revenues.
However, the impact of the two declining therapies (Radicava and Makena) and divested respiratory therapy assets are likely to have weighed upon Option Care Health’s revenues in the to-be-reported quarter. This raises our apprehension about the company.
The Estimate Picture
For third-quarter 2023, the Zacks Consensus Estimate for total revenues of $1.09 billion implies an improvement of 6.9% from the prior-year quarter’s reported figure.
The consensus estimate for EPS is pegged at 29 cents, implying an uptick of 38.1% from the prior-year quarter’s reported number.
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. This is not the case here, as you can see below.
Earnings ESP: Option Care Health has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank: The company currently flaunts a Zacks Rank #1.
Stocks Worth a Look
Here are a few other medical stocks worth considering, as these have the right combination of elements to beat on earnings this reporting cycle.
Edwards Lifesciences Corporation EW has an Earnings ESP of +3.06% and a Zacks Rank of 2. EW has an estimated long-term growth rate of 8%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Edwards Lifesciences’ earnings surpassed estimates in three of the trailing four quarters and missed once, with the average surprise being 1.6%.
Insulet Corporation PODD has an Earnings ESP of +6.61% and a Zacks Rank of 2. PODD has an estimated long-term growth rate of 41.5%.
Insulet’s earnings surpassed estimates in all the trailing four quarters, with the average surprise being 126.9%.
DENTSPLY SIRONA Inc. XRAY has an Earnings ESP of +1.85% and sports a Zacks Rank of 1 at present. XRAY has an estimated long-term growth rate of 8.9%.
DENTSPLY SIRONA’s earnings surpassed estimates in three of the trailing four quarters and missed once, with the average surprise being 12.5%.
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DENTSPLY SIRONA Inc. (XRAY) : Free Stock Analysis Report
Insulet Corporation (PODD) : Free Stock Analysis Report
Option Care Health, Inc. (OPCH) : Free Stock Analysis Report
