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Hologic, Inc. HOLX reported adjusted earnings per share (EPS) of $1.08 in the third quarter of fiscal 2025, up 1.9% year over year. The metric surpassed the Zacks Consensus Estimate by 2.86%.
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 86 cents in the quarter, which increased 4.9% year over year.
Revenues totaled $1.02 billion in the quarter, up 1.2% year over year (0.4% at the constant exchange rate or CER). The top line surpassed the Zacks Consensus Estimate by 1.68%.
However, following the earnings announcement, HOLX shares dropped 0.7% in yesterday’s after-hours session.
In the fiscal third quarter, U.S. revenues fell 0.6% to $760.7 million. This missed our model’s projection of $749.5 million.
Hologic, Inc. price-consensus-eps-surprise-chart | Hologic, Inc. Quote
International revenues amounted to $263.1 million, up 6.9% year over year (3.5% at CER). Our model’s projection was $252.3 million.
Revenues in the segment increased 1.8% year over year (up 0.9% at CER) to $448.9 million in the quarter, mainly driven by higher molecular diagnostics sales. Excluding COVID-19 revenues, organic Diagnostics revenues increased 3.9% on a reported basis. This compares with our model’s segmental projection of $436 million.
Within the division, Cytology & Perinatal revenues of $121.4 million dropped 2.2% at CER. This compares with our model’s segmental projection of $115.5 million.
Molecular Diagnostics revenues of $320.5 million increased 2.4% at CER. Our model forecast was $314.6 million.
Blood Screening revenues of $7 million fell 11.4% year over year at CER. Our model forecast for the business was $6 million.
The segment’s revenues decreased 5.1% from the year-ago period (down 5.8% at CER) to $365.2 million. The downside was due to lower sales of mammography capital equipment, as anticipated. Our model projected revenues of $366.8 million for this segment.
Excluding the divested SSI and acquired Endomagnetics businesses, organic Breast Health revenues decreased 10.1% (10.8% at constant currency).
Surgical revenues grew 7.1% year over year (6.3% at CER) to $178.4 million, primarily driven by the acquired Gynesonics business and strong international sales. Our model projected revenues of $177.3 million in this segment.
Revenues surged 64.7% year over year (62.1% at CER) to $31.3 million. Our model projected revenues of $26.6 million for this segment.
In the fiscal third quarter, the company-provided adjusted gross margin decreased 80 basis points (bps) to 60.3%, mainly due to the product mix and increased reserves.
Hologic’s adjusted operating margin was 30.1%, a contraction of 110 bps, due to expected margin dilution from the inclusion of Endomagnetics and Gynesonics results.
Hologic ended the third quarter of fiscal 2025 with cash and cash equivalents of $1.74 billion compared with $1.43 billion at the end of the first quarter.
Total long-term debt (including the current portion) was $2.51 billion compared with $2.52 billion at the second quarter-end.
Net cash provided by operating activities at the end of the fiscal third quarter was $702 million compared with $918.2 million a year ago.
Revenues for the full fiscal 2025 are now expected in the band of $4.08-$4.09 billion (earlier $4.05-$4.10 billion), representing a year-over-year increase of 1.3%-1.5%. The Zacks Consensus Estimate for fiscal 2025 revenues is pegged at $4.08 billion.
Hologic now anticipates fiscal 2025 adjusted EPS in the range of $4.23-$4.26 (previously $4.15-$4.25). The updated projections indicate 3.7%-4.4% growth year over year. The Zacks Consensus Estimate for the same is pegged at $4.19.
For the fourth quarter of fiscal 2025, the company forecasts revenues between $1.03 billion and $1.04 billion, suggesting a year-over-year increase of 4.3%-5.3% on a reported basis. The Zacks Consensus Estimate for the metric is pegged at $1.04 billion.
Adjusted EPS is estimated between $1.09 and $1.12, which implies 7.9% to 10.9% growth year over year. The Zacks Consensus Estimate for the metric currently stands at $1.09.
Hologic delivered earnings and revenue beats in the third quarter of fiscal 2025. Both metrics surpassed the company’s internal expectations as well. Hologic made meaningful progress toward returning to better top and bottom-line growth by year-end. Diagnostics and Surgical continued to perform well, while Skeletal Health also provided a boost. In Breast Health, Hologic shipped more 3D gantries than in the previous quarter, driving the sequential improvement it had projected. The company is also working on mitigating the impact of global tariffs on its business, which is encouraging.
On the flip side, both the gross and operating margins contracted in the quarter. Hologic expects continued pressure on its Diagnostics business outside the United States due to the challenging operating environment in China and reduced funding for HIV testing in Africa.
Hologic currently has a Zacks Rank #4 (Sell).
Some better-ranked stocks from the broader medical space are Medpace Holdings MEDP, GeneDx Holdings WGS and Boston Scientific BSX.
Medpace Holdings, currently sporting a Zacks Rank #1 (Strong Buy), reported a second-quarter 2025 EPS of $3.1, which beat the Zacks Consensus Estimate by 3.33%. Revenues of $603.3 million topped the consensus mark by 11.48%. You can see the complete list of today’s Zacks #1 Rank stocks here.
MEDP has a historical five-year earnings growth rate of 30.9% compared with the S&P 500 composite’s 10.1% growth. The company surpassed earnings estimates in each of the trailing four quarters, with the average surprise being 13.87%.
GeneDx Holdings, carrying a Zacks Rank #2 (Buy) at present, posted a second-quarter 2025 adjusted EPS of 50 cents, exceeding the Zacks Consensus Estimate by a remarkable 400%. Revenues of $102.7 million surpassed the Zacks Consensus Estimate by 21.24%.
WGS has an estimated earnings growth rate of 79.6% for 2026 compared with the industry’s 18.6% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 231.40%.
Boston Scientific, currently carrying a Zacks Rank #2, reported a second-quarter 2025 adjusted EPS of 75 cents, which topped the Zacks Consensus Estimate by 4.2%.
BSX has a historical five-year earnings growth rate of 13.3% compared with the industry’s 2.7% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 8.11%.
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This article originally published on Zacks Investment Research (zacks.com).
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