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Hologic (HOLX)
:HOLX
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Hologic
(NASDAQ:HOLX)
71Outperform
Positive Factors
Financial Performance
HOLX's gross margin was up 80 bps and its operating margin was up 90 bps.
Management Actions
HOLX has removed the responsible senior executives, and CEO MacMillan expressed confidence HOLX will emerge stronger from this episode.
Negative Factors
Breast Health Segment
The company continues to experience a number of challenges in their Breast Health business.
Market Challenges
HOLX is facing multiple headwinds including inadequate forecasting process, sales execution, and hospital CapEx pressures.
Revenue Outlook
Management lowered their FY25 revenue guidance but maintained their EPS guidance.
Hologic (HOLX) vs. S&P 500 (SPY)
Market Cap
$13.75B
Dividend YieldN/A
Average Volume (3M)2.67M
Price to Earnings (P/E)18.5
Beta (1Y)0.23
Revenue Growth1.75%
EPS Growth50.25%
CountryUS
Employees7,063
SectorHealthcare
Sector Strength78
IndustryMedical - Instruments & Supplies
Share Statistics
EPS (TTM)3.16
Shares Outstanding224,389,620
10 Day Avg. Volume2,698,281
30 Day Avg. Volume2,666,436
Financial Highlights & Ratios
PEG Ratio0.37
Price to Book (P/B)N/A
Price to Sales (P/S)3.42
Price to Cash Flow (P/CF)18.20
P/FCF Ratio19.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$82.00Price Target Upside40.27% Upside
Rating ConsensusHold
Number of Analyst Covering12
Hologic Business Overview & Revenue Model
Company DescriptionHologic, Inc. is a leading global medical technology company specializing in women's health. The company operates in sectors including diagnostics, breast and skeletal health, and gynecological surgical products. Its core products and services are centered around improving women's health and well-being through innovative solutions in diagnostics, medical imaging systems, and surgical devices.
How the Company Makes MoneyHologic makes money primarily through the sale of its medical devices and diagnostic products. Key revenue streams include sales from its diagnostics division, which offers a range of testing and detection products for various health conditions, and its breast and skeletal health division, which sells mammography and biopsy systems. The company's gynecological surgical products division also contributes to revenue through the sale of minimally invasive surgical devices. Hologic's earnings are supported by strong partnerships with healthcare providers and institutions, which facilitate the widespread adoption and integration of its technologies into health systems around the world.
Hologic Financial Statement Overview
Summary
Overall, Hologic's financial performance is solid with strong profitability and cash flow metrics, though revenue growth has stagnated. The balance sheet is healthy, with low leverage and a strong equity position, positioning the company well to weather economic fluctuations and invest in future growth. However, declining ROE and net profit margins suggest areas for improvement in operational efficiency and cost management.Income Statement
Hologic has shown resilience with a stable gross profit margin of 56.2% in TTM (Trailing-Twelve-Months). However, revenue growth has been flat compared to the previous year, indicating market saturation or challenges in expanding market share. The net profit margin of 18.4% is healthy, though it reflects a decline from historical highs, suggesting rising costs or competitive pressures.72
Positive
Balance Sheet
The company maintains a strong equity base with an equity ratio of 54.7% in TTM, indicating financial stability. The debt-to-equity ratio is low at 0.01, showcasing prudent financial management. However, the return on equity (ROE) has decreased to 15.6% in TTM, highlighting potential inefficiencies in generating returns from equity.78
Positive
Cash Flow
Hologic's cash flow is robust, with a high operating cash flow to net income ratio of 1.69 in TTM, indicating excellent cash generation capabilities. The free cash flow has grown significantly by 25.9% compared to the previous period, demonstrating strong operational efficiency and financial health.80
Positive
| Breakdown | |||||
| TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 4.04B | 4.03B | 4.03B | 4.86B | 5.63B | 3.78B | Gross Profit |
| 2.27B | 2.23B | 2.07B | 3.00B | 3.80B | 2.23B | EBIT |
| 967.10M | 970.20M | 668.40M | 1.64B | 2.48B | 1.10B | EBITDA |
| 1.34B | 1.30B | 1.11B | 2.11B | 2.86B | 1.50B | Net Income Common Stockholders |
| 744.00M | 789.50M | 456.00M | 1.30B | 1.87B | 1.12B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 431.31M | 2.33B | 2.72B | 2.34B | 1.17B | 701.00M | Total Assets |
| 5.74B | 9.16B | 9.14B | 9.07B | 8.92B | 7.20B | Total Debt |
| 1.46B | 2.66B | 2.82B | 2.82B | 3.03B | 3.04B | Net Debt |
| 1.03B | 497.80M | 95.70M | 483.90M | 1.85B | 2.34B | Total Liabilities |
| 2.95B | 4.03B | 4.12B | 4.20B | 4.70B | 4.49B | Stockholders Equity |
| 2.79B | 5.13B | 5.02B | 4.88B | 4.22B | 2.71B |
| Cash Flow | Free Cash Flow | ||||
| 1.14B | 1.15B | 901.00M | 2.00B | 2.17B | 740.20M | Operating Cash Flow |
| 1.25B | 1.29B | 1.05B | 2.13B | 2.33B | 896.60M | Investing Cash Flow |
| -698.80M | -781.00M | -152.10M | -206.30M | -1.33B | -141.60M | Financing Cash Flow |
| -701.80M | -1.11B | -483.20M | -756.00M | -529.80M | -659.90M |
Hologic Technical Analysis
Negative
58.46
Price Trends
63.98
Negative
69.20
Negative
74.48
Negative
Market Momentum
-0.98
Negative
44.62
Neutral
60.40
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HOLX, the sentiment is Negative. The current price of 58.46 is below the 20-day moving average (MA) of 61.20, below the 50-day MA of 63.98, and below the 200-day MA of 74.48, indicating a bearish trend. The MACD of -0.98 indicates Negative momentum. The RSI at 44.62 is Neutral, neither overbought nor oversold. The STOCH value of 60.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HOLX.
Hologic Risk Analysis
Hologic disclosed 30 risk factors in its most recent earnings report. Hologic reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Hologic Peers Comparison
Overall Rating
UnderperformOutperform
Sector (48)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $31.28B | 25.16 | 25.65% | 0.97% | 9.38% | 40.38% | |
76 Outperform | $59.53B | 34.44 | 6.92% | 1.94% | 5.89% | 42.05% | |
73 Outperform | $14.75B | 35.45 | 5.25% | ― | 7.15% | 41.96% | |
71 Outperform | $13.75B | 18.50 | 15.78% | ― | 1.75% | 50.25% | |
65 Neutral | $14.69B | 30.40 | 17.71% | 0.41% | -1.93% | -15.47% | |
54 Neutral | $14.69B | 136.07 | -9.24% | 3.21% | -14.00% | -184.82% | |
48 Neutral | $6.27B | 1.17 | -48.19% | 2.68% | 17.28% | 1.24% |
* Healthcare Sector Average
Performance Comparison
HOLX
Hologic
58.46
-19.15
-24.67%
BAX
Baxter International
27.97
-12.94
-31.63%
BDX
Becton Dickinson
200.83
-36.02
-15.21%
COO
Cooper Co
71.50
-25.00
-25.91%
RMD
Resmed
204.54
12.48
6.50%
WST
West Pharmaceutical Services
190.39
-198.41
-51.03%
Hologic Earnings Call Summary
Earnings Call Date: Feb 5, 2025 | % Change Since: -19.70% | Next Earnings Date: May 1, 2025
Earnings Call Sentiment Neutral
Hologic's earnings call presented a mixed outlook. The company showed strength in its Diagnostics division and maintained strong operating margins, but faced challenges in Breast Health and Skeletal businesses, along with lowered revenue guidance. The commitment to maintaining EPS guidance despite revenue challenges highlights operational efficiency.Highlights
Diagnostics Revenue Growth
The Diagnostics division reported revenue of $470.6 million, showing a 5.2% growth and a 9.1% organic growth excluding COVID-related sales. Molecular diagnostics grew by 6.7% or 11% when excluding COVID-related sales.
Non-GAAP EPS Performance
Non-GAAP earnings per share were $1.03, at the high end of the guidance range and an increase of 5% year-over-year.
Strong Operating Margin
Non-GAAP operating margins improved by 90 basis points, demonstrating substantial operating leverage.
Gynesonics Acquisition
Hologic completed the acquisition of Gynesonics, which had about $28 million in revenue in its most recent fiscal year and is expected to grow at a healthy double-digit rate.
Lowlights
Breast Health Revenue Decline
Total first quarter revenue for Breast Health was $369.1 million, a decline of 2.1% overall or 5.8% organically.
Skeletal Revenue Decline
First-quarter revenue for the Skeletal business was $15.8 million, a decrease of 37.4% due to late resumption of Horizon DXA unit shipments.
Lowered Full-Year Revenue Guidance
Full-year revenue guidance was lowered by $100 million to a range of $4.05 billion to $4.10 billion, citing factors such as FX headwinds and softer Breast Health capital equipment sales.
Company Guidance
During the call, Hologic provided guidance for their fiscal year 2025, projecting total revenue between $4.05 billion and $4.10 billion, reflecting a $100 million reduction from previous estimates, primarily due to currency headwinds and softer Breast Health capital sales. Despite these revenue adjustments, they maintained their non-GAAP EPS guidance of $4.25 to $4.35, showcasing their operational efficiency. The first quarter saw a 1% revenue increase to $1.022 billion on a constant currency basis, with non-GAAP EPS reaching $1.03, a 5% year-over-year growth. Key metrics included a non-GAAP gross margin of 61.6%, a 90 basis point increase in operating margins, and a net margin of 23.4%. They also highlighted strong performance in the Diagnostics division, with 9.1% organic growth excluding COVID-19 sales, and outlined expectations for gradual revenue growth improvement throughout the year, ending with strong growth in Q4.Hologic Corporate Events
Executive/Board Changes
Hologic Expands Board with New Director Appointment
Positive
Apr 4, 2025
On April 4, 2025, Hologic, Inc. announced the election of Wayde McMillan to its Board of Directors, expanding the board from eight to nine members. Mr. McMillan, who has extensive experience in financial leadership roles within the med-tech industry, will also serve on the company’s Audit and Finance Committee. This appointment is expected to enhance the board’s financial expertise and support Hologic’s strategic focus on women’s health.
Executive/Board Changes
Hologic Announces Leadership Transition with New General Counsel
Neutral
Mar 3, 2025
On February 26, 2025, Hologic announced the retirement of John Griffin, its General Counsel, who will transition to the role of Special Advisor to the Chairman, President, and CEO effective May 1, 2025. Anne Liddy, currently Vice President and Assistant General Counsel, will succeed him as General Counsel. This transition is part of a structured plan to ensure continuity in leadership and operations.
Executive/Board Changes
Hologic Announces Board of Directors Changes
Neutral
Jan 10, 2025
Hologic announced that Sally W. Crawford will retire from its Board of Directors, and Scott T. Garrett will not be re-elected due to reaching the retirement age, resulting in a reduction of the Board to eight directors. This decision is not due to disagreements with the company, and both individuals were thanked for their contributions, which signifies a period of transition and potential strategic refocusing for the company.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.