Dive Brief:
- Hologic kicked off the new year with an upward revision to it first-quarter revenue forecast, attributing the stronger growth to acceleration in its U.S. breast health, molecular diagnostics and international businesses.
- Each of the three units, which are the company's largest businesses, posted double-digit growth on a constant-currency basis to start the year, the company said Monday in releasing the preliminary results ahead of a presentation at the J.P. Morgan Healthcare Conference.Hologic's shares gained 3.4% on the news to close at $40.49.
- While the company did not update its earnings forecast or full-year outlook, the first-quarter revenue outperformance could signal an upward bias to those numbers, Leerink analyst Richard Newitter said in a note to clients.
Dive Insight:
Hologic, which generated revenue of nearly $3.22 billion in fiscal 2018, specializes in products for detection and treatment of women's conditions. It has a particular focus on breast healthcare, where its devices span the gamut from screening to surgery.
Recent acquisitions in the breast health segment include the $85 million purchase of Faxitron Bioptics, a digital specimen radiography company, and the $125 million purchase of Focal Therapeutics and its BioZorb marker used in breast cancer surgery.
In its J.P. Morgan presentation, the company said it is entering its next chapter with a strategy to accelerate growth that includes a broad range of offerings to facilitate platform consolidation, market share gains, new product sales and growth-accretive deals.
Beyond breast health, the Marlborough, Massachusetts-based company is also focused on expanding in diagnostics, where it has gone from being a niche player in sexually transmitted diseases to a broad-based molecular diagnostics leader. Its growing assay menu includes women's health, virals, respiratory and other specialties.
The company, in its presentation, said it is beginning to realize its international potential, with revenue in the division growing 13% in 2018, up from 11% the year before and flat revenue in 2016.
For the first quarter ended Dec. 29, Hologic said it expects to report total revenue of about $831 million, up 5% from the same quarter a year ago, or up 5.7% in constant currency. The preliminary results compare to the company's previous forecast for a range of $800 million to $815 million.
Leerink's Newitter said Hologic's first-quarter revenue beat was driven by outperformance in the breast health business. The beat could translate into an additional two cents of earnings upside, he said.
