Core Viewpoint - Hologic reported a mixed performance in its Q1 fiscal 2025 earnings, with adjusted earnings per share surpassing estimates, but revenues showing modest growth and a downward revision in full-year guidance [2][3][13]. Financial Performance - Adjusted earnings per share for Q1 fiscal 2025 were $1.03, reflecting a 5.1% year-over-year increase and exceeding the Zacks Consensus Estimate by 0.9% [2]. - Total revenues reached $1.02 billion, marking a 0.9% year-over-year increase, consistent with the Zacks Consensus Estimate [3]. - U.S. revenues were $757.9 million, up 0.6% year over year, while international revenues totaled $263.9 million, up 1.7% year over year [4]. Segment Performance - Diagnostics segment revenues increased 5.1% year over year to $470.6 million, with a notable 9% increase excluding COVID-19 revenues [5]. - Breast Health segment revenues decreased 2.3% year over year to $369.1 million, attributed to lower sales of mammography capital equipment [7]. - GYN Surgical segment reported a 2.5% year-over-year increase in revenues to $166.3 million [8]. - Skeletal Health segment revenues declined 37.8% year over year to $15.8 million [10]. Operational Metrics - Adjusted gross margin improved by 80 basis points to 61.6%, while adjusted operating margin expanded by 90 basis points to 29.4% [11]. Financial Position - Cash and cash equivalents at the end of Q1 were $1.78 billion, down from $2.16 billion at the end of Q4 fiscal 2024 [12]. - Total long-term debt increased slightly to $2.53 billion from $2.50 billion [12]. Guidance and Outlook - For fiscal 2025, Hologic revised revenue guidance to $4.05-$4.10 billion, down from the previous $4.15-$4.20 billion [13]. - Adjusted earnings per share guidance remains at $4.25-$4.35, with projected growth of 4.2%-6.6% year over year [14]. - For Q2 fiscal 2025, revenue is expected to be between $995 million and $1.01 billion, indicating a year-over-year decline [14][15]. Market Sentiment - Recent estimates for Hologic have been trending downward, indicating a cautious outlook among investors [16][18]. - The stock currently holds a Zacks Rank 3 (Hold), suggesting an expectation of in-line returns in the near term [18].

Core Viewpoint - Hologic has received two significant regulatory approvals, enhancing its product portfolio, while facing challenges reflected in its recent fiscal report, leading to a decline in stock price. Regulatory Approvals - Hologic's Affirm Contrast Biopsy software has received the CE Mark, complementing its FDA clearance from October 2020. The Aptima SARS-CoV-2 assay has achieved FDA's 510k clearance after previously being granted Emergency Use Authorization in May 2020 [1][2][8]. Financial Performance - Hologic's Q1 revenues reached $1.02 billion, aligning with Zacks Consensus Estimate, with a 1% growth target in constant currency. The Diagnostics division grew 9.1% organically, while Breast Health revenues declined by 2.1% [5][6]. - The adjusted gross margin improved by 80 basis points to 61.6%, and adjusted operating margin expanded by 90 basis points to 29.4%. Adjusted EPS was $1.03, exceeding consensus by 0.9% and up 5% year-over-year [6][7]. Stock Performance - Hologic's stock has declined 9.3% year-to-date, underperforming the industry growth of 5.4% and the broader sector's 6.2% rise. The stock closed at $65.01, reflecting a 10.4% drop post-earnings announcement [2][3]. Long-Term Growth Prospects - Hologic has achieved a 4.8% CAGR in revenues over the past decade, with adjusted EPS growing at 10.8% CAGR. The company anticipates continued double-digit earnings growth, supported by steady revenue increases [12][14]. - The Biotheranostics business is a key growth driver, particularly with the Breast Cancer Index test. Hologic aims to diversify its revenue mix, with service revenues in Breast Health now surpassing the gantry business [13][14]. M&A Strategy and Innovation - Hologic plans to leverage M&A to expand into high-growth adjacent markets, having recently acquired Gynesonics and Endomagnetics, contributing to revenue growth [14][15]. - The company is introducing AI-powered diagnostic systems and has plans for the commercial launch of the Envision Platform next year, indicating a focus on innovation [15]. Revised Financial Expectations - Hologic has revised its fiscal 2025 sales expectations down by $100 million to a range of $4.05-$4.10 billion, citing adverse impacts from currency fluctuations and geopolitical challenges [17][19]. - The company expects adjusted EPS between $4.25 and $4.35 for fiscal 2025, despite the challenges faced [19].

Core Insights - The article highlights two lesser-known S&P 500 stocks, Synopsys and Hologic, that present significant growth potential despite their current market challenges [1]. Synopsys (NASDAQ: SNPS) - Synopsys has shown resilience with an 8% year-to-date increase in stock price, closing at $528, despite a nearly 5% decline over the past year [2][3]. - The company reported revenue of $1.64 billion for the quarter ending October 24, marking an 11% year-over-year growth, with earnings per share at $7.15, reflecting a more than 200% increase [3]. - Synopsys is pursuing a $35 billion acquisition of Ansys, expected to close in early 2025, which could enhance its market position pending regulatory approvals [4]. - The increasing complexity of semiconductor design, driven by AI, machine learning, and IoT, is expected to boost demand for Synopsys' Electronic Design Automation tools [5]. - Analysts at TipRanks have set a 12-month price target of $630 for Synopsys, indicating a potential upside of 20%, with targets ranging from $540 to $690 [6]. Hologic (NASDAQ: HOLX) - Hologic operates in the medical technology sector, focusing on breast health and diagnostics, and has a strong portfolio despite being overshadowed by larger healthcare companies [8]. - The company is well-positioned to benefit from an aging population and the growing emphasis on early disease detection and personalized medicine [9]. - Hologic's collaboration with the CDC to develop reagents for detecting H5N1 bird flu highlights its capability to scale testing rapidly during public health crises [10]. - The stock price for Hologic ended at $64.27, down 0.6%, with a year-to-date decline of 10% [11]. - Analysts project a potential rally of over 30% for Hologic, with an average price target of $83.54 within the next 12 months, ranging from $75 to $90 [12].

Core Insights - Hologic (HOLX) is experiencing growth from new strategic product launches in Diagnostics and Breast Health, but macroeconomic challenges and unfavorable foreign exchange impacts are hindering its overall growth [1][8] Growth Drivers - The molecular diagnostic assays segment is a significant revenue contributor, accounting for 11% of revenues in Q1 fiscal 2025, excluding COVID-19 sales [2] - The company's BV CV/TV assay has shown strong double-digit growth, and the Biotheranostics lab testing business is also contributing positively [2] - Hologic's core women's health assays on the Panther platform performed robustly during the quarter [2] - The new Envision Mammography Platform, which offers a 2.5-second scan time, is set for commercial launch next year [3] - The next-generation Genius AI Detection PRO solution aims to enhance accuracy and efficiency in cancer screening, addressing racial bias concerns in AI-driven breast cancer diagnosis [4] International Expansion - Hologic's Surgical business is expanding into new global markets, with the International Surgical business reporting over 20% growth in Q1 fiscal 2025 [5] - The company is increasing the global reach of the Panther Fusion system to meet the demand for high-throughput molecular diagnostic respiratory testing [5] Operational Strategies - Hologic is streamlining operations and reducing costs through strategic investments in areas with good returns, such as the Genius marketing campaign and cervical cancer co-testing initiatives [6] Financial Performance - The stock has declined 13.2% over the past year, while the industry has risen by 5.2%, but there are expectations for the stock to regain momentum with the expansion of diagnostics and breast health offerings [7] - Hologic has reduced its full-year revenue guidance by $100 million to a range of $4.05 billion to $4.10 billion due to macroeconomic uncertainties and supply constraints [8] Challenges - The company faces challenges from potential long-term recession impacts, global supply constraints, and increased costs in manufacturing and transportation [8][9] - Hologic anticipates lower Breast Health capital equipment sales this year due to an overly aggressive initial forecast [10] - The strengthening U.S. dollar is expected to create a $20 million foreign currency headwind for fiscal 2025, a significant change from earlier expectations [11]

Core Insights - Hologic, Inc. has shown strong performance in its molecular diagnostics segment, but faces challenges from declining COVID-19 sales and a tough macroeconomic environment [1][7][8] Financial Performance - Hologic has a market capitalization of $14.47 billion and has beaten earnings estimates in three of the last four quarters, with an average surprise of 2.53% [2] - The company has reduced its full-year revenue guidance by $100 million to a range of $4.05-$4.10 billion, anticipating lower Breast Health capital equipment sales [9] Segment Performance - The molecular diagnostics segment contributed 11% to first-quarter fiscal 2025 revenues, excluding COVID-19 sales, with strong growth in the BV CV/TV assay and core women's health assays [4] - The Panther platform's adoption is increasing, with nearly 40% of U.S. customers utilizing the system as of the fiscal first quarter [4] Strategic Initiatives - Hologic has implemented strategic initiatives to streamline operations and reduce costs, including investments in marketing campaigns and competitive market share efforts [5] - The company received the Innovative Technology Contract from Vizient, which expands access to its surgical product lineup [6] Market Challenges - The decline in COVID-19 assay revenues is expected to restrain diagnostics sales growth to mid-single digits for fiscal 2025 [7] - Macroeconomic concerns, including potential recession impacts and global supply constraints, are affecting the company's ability to meet customer demand and increasing operational costs [8]

Core Insights - Hologic's international operations are crucial for understanding its financial strength and growth potential [1][2] - The company's reliance on overseas markets provides insights into its earnings durability and growth capabilities [2][3] Revenue Performance - Total revenue for the recent quarter reached $1.02 billion, reflecting a 0.9% increase from the prior-year quarter [4] - Revenue contributions from international markets showed notable trends, with Rest of World generating $55.2 million (5.40% of total revenue), Europe contributing $148.9 million (14.57%), and Asia-Pacific at $59.8 million (5.85%) [5][6][7] Regional Revenue Breakdown - Rest of World revenue exceeded consensus estimates by 0.31%, compared to $50.9 million (5.15%) in the previous quarter and $52.8 million (5.21%) in the same quarter last year [5] - Europe outperformed expectations by 8.27%, with a significant increase from $125 million (12.65%) in the previous quarter and $142.8 million (14.10%) in the same quarter last year [6] - Asia-Pacific revenue fell short of projections by 8.35%, with a decrease from $66.4 million (6.72%) in the previous quarter and an increase from $63.8 million (6.30%) in the year-ago quarter [7] Future Projections - Analysts project total revenue of $1 billion for the current fiscal quarter, a decline of 1.6% year-over-year, with expected contributions of 5.6% from Rest of World, 13.6% from Europe, and 6.6% from Asia-Pacific [8] - For the full year, total revenue is anticipated to reach $4.08 billion, reflecting a 1.3% increase from the previous year, with expected contributions of 5.5% from Rest of World, 13.5% from Europe, and 6.5% from Asia-Pacific [9] Strategic Considerations - Hologic's reliance on international markets presents both opportunities and challenges, necessitating close monitoring of international revenue trends to project future directions [10] - Analysts emphasize the importance of various factors, including local market status, in shaping revenue forecasts [11]

Core Insights - Zacks Premium offers various tools for investors to enhance their stock market strategies, including daily updates, research reports, and stock screens [1][2] Zacks Style Scores - Zacks Style Scores are indicators that rate stocks based on value, growth, and momentum characteristics, helping investors identify stocks likely to outperform the market in the short term [2][3] - Each stock is rated from A to F, with A indicating the highest potential for outperformance [3] Value Score - The Value Score identifies attractive and discounted stocks using financial ratios such as P/E, PEG, and Price/Sales [3] Growth Score - The Growth Score focuses on a company's financial health and future outlook, analyzing projected and historical earnings, sales, and cash flow [4] Momentum Score - The Momentum Score helps investors capitalize on price trends by analyzing short-term price changes and earnings estimate revisions [5] VGM Score - The VGM Score combines all three Style Scores, providing a comprehensive indicator for investors seeking stocks with strong value, growth, and momentum [6] Zacks Rank - The Zacks Rank is a proprietary model that uses earnings estimate revisions to guide investors in building successful portfolios [7] - Stocks rated 1 (Strong Buy) have historically achieved an average annual return of +25.41% since 1988, significantly outperforming the S&P 500 [8] Stock Selection Strategy - To maximize returns, investors should focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B [9] - Stocks with lower ranks but high Style Scores may still face downward price pressure due to negative earnings outlooks [10] Company Spotlight: Hologic Inc. (HOLX) - Hologic Inc. is a medical technology company focused on women's health, currently holding a Zacks Rank of 3 (Hold) and a VGM Score of B [11] - The company has seen upward revisions in earnings estimates, with the Zacks Consensus Estimate for fiscal 2025 at $4.28 per share, and an average earnings surprise of 2.5% [12]

Revenue Performance - Product revenues for the quarter totaled $817.9 million, a decrease of 1.2% compared to $828.1 million in the prior year[132]. - Diagnostics segment revenue increased by $17.5 million, or 4.2%, driven by a $16.2 million increase in Molecular Diagnostics and a $5.7 million increase in Cytology revenue[133]. - Breast Health segment revenue decreased by $23.1 million, or 9.9%, from $232.9 million to $209.8 million[132]. - Skeletal Health segment revenue saw a significant decline of 57.8%, dropping from $16.6 million to $7.0 million[132]. - The overall decrease in product revenues was primarily due to declines in Breast Health and Skeletal Health segments, offset by increases in Diagnostics and GYN Surgical revenues[132]. - Breast Health product revenues decreased by $23.1 million, or 9.9%, primarily due to lower sales of digital mammography systems and longer sales cycles[134]. - GYN Surgical product revenues increased by $5.0 million, or 3.2%, driven by higher sales of the Fluent fluid management system and MyoSure devices in Europe[135]. - Skeletal Health product revenues decreased by $9.6 million, or 57.8%, due to a temporary stop-ship of Horizon DXA systems[136]. - Service and other revenues increased by $18.9 million, or 10.2%, primarily from expanded Breast Health service contracts and higher lab testing volumes[139]. Operating Income and Expenses - Diagnostics segment revenues increased by 5.1% to $470.6 million, with operating income rising by 140.7% to $118.9 million, resulting in an operating income margin of 25.3%[160]. - Breast Health segment revenues decreased by 2.3% to $369.1 million, with operating income declining by 34.0% to $67.5 million, leading to an operating income margin of 18.3%[163]. - GYN Surgical segment revenues increased by 2.5% to $166.3 million, with operating income rising by 7.9% to $46.6 million, resulting in an operating income margin of 28.0%[167]. - Skeletal Health segment revenues decreased by 37.8% to $15.8 million, with operating income turning negative at $(3.2) million, reflecting a significant decline in performance[170]. - Operating expenses decreased by $18.6 million, or 5.0%, with research and development expenses down by 9.8% due to lower headcount and project spend[147][148]. Cash Flow and Working Capital - The company had $2,491.2 million in working capital and cash and cash equivalents of $1,782.1 million as of December 28, 2024, with a decrease of $378.1 million in cash during the first three months of fiscal 2025[173]. - Operating activities generated cash of $189.3 million, primarily driven by net income of $201.0 million and non-cash charges, despite a cash outflow of $77.2 million from changes in operating assets and liabilities[174]. Debt and Interest - Total recorded debt outstanding was $2.53 billion as of December 28, 2024, including $1.19 billion under the 2021 Credit Agreement and $941.3 million in 2029 Senior Notes[178]. - The interest rate under the 2021 Term Loan was 5.44% per annum as of December 28, 2024, reflecting the company's borrowing costs[180]. - The company has a remaining scheduled balance of $1.085 billion on the 2021 Term Loan, with principal payments ranging from $9.375 million to $18.75 million per three-month period starting December 26, 2025[181]. - As of December 28, 2024, the outstanding principal balance of the 2021 Term Loan was $1.2 billion, and the company was in compliance with financial covenants[182][183]. - The total aggregate principal balance of the 2028 Senior Notes is $400 million, maturing on February 1, 2028, with an interest rate of 4.625% per year[184]. - The total aggregate principal balance of the 2029 Senior Notes is $950 million, maturing on February 15, 2029, with an interest rate of 3.250% per year[185]. - A hypothetical 10% increase in the SOFR rate would increase annual interest expense by approximately $3 million, net of the impact of interest rate swap hedges[195]. - A hypothetical 100 basis point change in market rates would change annual interest income by approximately $13.2 million based on current cash and investment balances[196]. Acquisitions and Strategic Moves - The company completed the acquisition of Endomagnetics Ltd for $313.9 million, enhancing its Breast Health segment[129]. - The company sold its SSI ultrasound imaging business for $1.9 million, with an additional funding of $33.2 million for transition services[130]. - The company completed the acquisition of Gynesonics, Inc. for approximately $350 million, enhancing its diagnostic imaging technology segment[187]. Foreign Currency and Tax - For the first quarter of fiscal 2025, the company reported net foreign currency exchange gains of $25.6 million, a significant improvement from a loss of $13.1 million in the same period last year, marking a change of 372.7% in Other Income (Expense), net[156]. - The effective tax rate for the three months ended December 28, 2024, was 18.8%, compared to a benefit of 28.9% for the same period in the prior year, reflecting a significant change in tax provision[158]. - The company believes that foreign currency exchange risk is not significant, with a hypothetical 10% change in foreign currencies not materially impacting financial condition or results[198]. Other Notable Points - The percentage of product revenue from Europe increased to 16.0% from 15.3%, attributed to a penalty payment from the German government and increased GYN Surgical product sales[138]. - The company expects to resume shipments of remaining DXA products during the second and third quarters of fiscal 2025 as supply issues are resolved[136]. - The company authorized a new stock repurchase program of up to $1.5 billion, with $1.17 billion remaining unused as of December 28, 2024[186]. - As of December 28, 2024, the fair value of the 2028 and 2029 Senior Notes was approximately $387.4 million and $860.9 million, respectively[193].

Hologic, Inc. (HOLX) reported adjusted earnings per share (EPS) of $1.03 in the first quarter of fiscal 2025, up 5.1% year over year. The metric surpassed the Zacks Consensus Estimate by 0.9%.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.The adjustments include charges and benefits related to the amortization of acquired intangible assets, restructuring and integration/consolidation costs and many others. The company’s GAAP EPS was 87 cents in the quarter compared with $1.03 in the ...

Hologic, Inc. (NASDAQ:HOLX) Q1 2025 Earnings Conference Call February 5, 2025 4:30 PM ET Company Participants Mike Watts - Corporate Vice President, IR Steve MacMillan - Chairman, President and CEO Essex Mitchell - COO Karleen Oberton - CFO Conference Call Participants Patrick Donnelly - Citi Anthony Petrone - Mizuho Group Doug Schenkel - Wolfe Research Vijay Kumar - Evercore ISI Tycho Peterson - Jefferies Casey Woodring - JP Morgan Tejas Savant - Morgan Stanley Ryan Zimmerman - BTIG Jack Meehan - Nephron R ...