Hologic (HOLX) AI Stock Analysis

• Market Cap: $13.03B
• Dividend Yield: N/A
• Average Volume (3M): 3.32M
• Price to Earnings (P/E): 18.4
• Beta (1Y): 0.16
• Revenue Growth: 1.75%
• EPS Growth: 50.25%
• Country: US
• Employees: 7,063
• Sector: Healthcare
• Sector Strength: 69
• Industry: Medical - Instruments & Supplies
• EPS (TTM): 3.16
• Shares Outstanding: 224,389,620
• 10 Day Avg. Volume: 3,118,300
• 30 Day Avg. Volume: 3,321,510
• PEG Ratio: 0.37
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.34
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 7.82
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $77.50
• Price Target Upside: 32.80% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 10

Hologic's stock receives an overall score of 63. The strong financial performance with robust cash flow and a healthy balance sheet is countered by stagnant revenue growth and declining ROE and net profit margins. The bearish technical indicators point to potential short-term downward pressure on the stock. Valuation appears fair, but lacks appeal for income investors due to the absence of a dividend yield. The earnings call highlighted operational efficiencies but also pointed out challenges in key segments and lowered revenue guidance, affecting the overall sentiment.

Positive Factors

Financial Performance

HOLX's gross margin was up 80 bps and its operating margin was up 90 bps.

Financial Strategy

HOLX balance sheet helps to offset top-line weakness through share buybacks.

Leadership and Strategy

The senior executives responsible for forecasting errors have been removed, and CEO MacMillan expressed confidence HOLX will emerge stronger from this episode.

Negative Factors

Economic Environment

Greater uncertainty under current administration, where women's health appears to be getting deprioritized.

Market Demand

HOLX overestimated gantry sales as they did not recognize unsustainable pent-up demand after COVID and longer replacement cycles.

Sector Challenges

The company continues to experience a number of challenges in their Breast Health business.

Hologic Business Overview & Revenue Model

Company Description

Hologic, Inc. develops, manufactures, and supplies diagnostics products, medical imaging systems, and surgical products for women's health through early detection and treatment in the United States, Europe, the Asia-Pacific, and internationally. It operates through four segments: Diagnostics, Breast Health, GYN Surgical, and Skeletal Health. The company provides Aptima molecular diagnostic assays to detect the infectious microorganisms; Aptima viral load tests for HIV, Hepatitis C, and Hepatitis B; Aptima SARS-CoV-2 and Panther Fusion SARS-CoV-2 assays for the detection of SARS-CoV-2; ThinPrep System for use in cytology applications; Rapid Fetal Fibronectin Test that assists physicians in assessing the risk of pre-term birth; and various diagnostic tests for the detection of Group B Streptococcus. It also offers breast imaging and analytics, such as 2D and 3D digital mammography systems and reading workstations, minimally invasive breast biopsy guidance systems and devices, breast biopsy site markers and localization, specimen radiology, and ultrasound and connectivity solutions; and breast conserving surgery products. In addition, the company provides NovaSure Endometrial Ablation System for the treatment of abnormal uterine bleeding; MyoSure Hysteroscopic Tissue Removal System for the removal of fibroids, polyps, and other pathology within the uterus; and Fluent Fluid Management System that provides liquid distention during diagnostic and operative hysteroscopic procedures. Further, it offers Horizon DXA, a dual energy X-ray system; and the Fluoroscan Insight FD mini C-arm to perform minimally invasive orthopedic surgical procedures. The company sells its products through direct sales and service forces, and independent distributors and sales representatives. Hologic, Inc. was incorporated in 1985 and is headquartered in Marlborough, Massachusetts.

How the Company Makes Money

Hologic 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.

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.

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.

Breakdown
Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement		Total Revenue
4.03B	4.03B	4.86B	5.63B	3.78B
	Gross Profit
2.23B	2.07B	3.00B	3.80B	2.23B
	EBIT
970.20M	668.40M	1.64B	2.48B	1.10B
	EBITDA
1.30B	1.11B	2.11B	2.86B	1.50B
	Net Income Common Stockholders
789.50M	456.00M	1.30B	1.87B	1.12B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.33B	2.72B	2.34B	1.17B	701.00M
	Total Assets
9.16B	9.14B	9.07B	8.92B	7.20B
	Total Debt
2.66B	2.82B	2.82B	3.03B	3.04B
	Net Debt
497.80M	95.70M	483.90M	1.85B	2.34B
	Total Liabilities
4.03B	4.12B	4.20B	4.70B	4.49B
	Stockholders Equity
5.13B	5.02B	4.88B	4.22B	2.71B
Cash Flow		Free Cash Flow
1.15B	901.00M	2.00B	2.17B	740.20M
	Operating Cash Flow
1.29B	1.05B	2.13B	2.33B	896.60M
	Investing Cash Flow
-781.00M	-152.10M	-206.30M	-1.33B	-141.60M
	Financing Cash Flow
-1.11B	-483.20M	-756.00M	-529.80M	-659.90M

Hologic Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 58.36
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: 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 58.36 is below the 20-day moving average (MA) of 58.77, below the 50-day MA of 61.12, and below the 200-day MA of 73.36, indicating a bearish trend. The MACD of -1.03 indicates Negative momentum. The RSI at 44.55 is Neutral, neither overbought nor oversold. The STOCH value of 62.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HOLX.

Hologic Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RMD	85 Outperform	$34.33B	26.29	25.81%	0.88%	9.54%	37.23%
WST	74 Outperform	$15.53B	33.94	17.42%	0.38%	-1.14%	-16.35%
COO	72 Outperform	$16.37B	39.58	5.25%	―	7.15%	41.96%
BDX	70 Outperform	$58.76B	33.99	6.92%	1.94%	5.89%	42.05%
HOLX	63 Neutral	$13.03B	18.38	15.78%	―	1.75%	50.25%
Sector *	51 Neutral	$5.35B	3.41	-40.83%	2.89%	18.11%	2.60%
BAX	49 Neutral	$15.66B	136.07	-9.24%	3.04%	-14.00%	-184.82%

Hologic Corporate Events

Hologic Expands Board with New Director Appointment

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.

Hologic Announces Leadership Transition with New General Counsel

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.