Bio-Rad Laboratories, Inc.
BIO
is slated to report second-quarter 2022 results on Jul 28, after the closing bell.
In the last-reported quarter, the company’s earnings per share (EPS) of $4.94 surpassed the Zacks Consensus Estimate by 76.4%. Moreover, earnings beat the consensus estimate in each of the last four quarters. The trailing four-quarter average surprise is 58.98%.
Let’s see how things are shaping up prior to the announcement.
Factors at Play
Bio-Rad’s
Life Science
segment has been registering robust revenue growth over the past few quarters. We expect this growth momentum to have continued in the second quarter on the back of sustained sales gains in terms of the company’s Polymerase Chain Reaction (PCR), Droplet Digital PCR (dPCR), Process Media businesses and Western Blot. The company has also been witnessing strong growth in the biopharma market for the Droplet Digital PCR platform, which is expected to have made significant contributions to the second-quarter top line.
We anticipate Bio-Rad’s core qPCR business to benefit from continued robust adoption of the latest generation CFX Opus platform, as was the case in the prior quarter. Added to this, we expect the buyout of Dropworks in 2021 to significantly expand the qPCR business, which is likely to have had a positive impact on the company’s performance in the to-be-reported quarter. Notably, Dropworks is creating a droplet-based digital PCR system that can offer a more cost-effective solution to streamline the digital PCR workflow for life science research and diagnostic applications.
BioRad Laboratories, Inc. Price and EPS Surprise
BioRad Laboratories, Inc. price-eps-surprise
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BioRad Laboratories, Inc. Quote
On its 2022 Investor Day, Bio-Rad noted that it expects to see accelerated growth within the
Clinical Diagnostics
segment in 2022, driven by its continued focus on laboratory workflow productivity, quality control value proposition, and new opportunities in molecular diagnostics. This uptrend was reflected though the first-quarter performance of the company that was influenced by the recovery of routine testing. We expect this trend to have continued through the second quarter on the back of the continued opening of the economy, thereby boosting the Clinical Diagnostics arm across all product lines.
Further, in recent times, Bio-Rad launched PREvalence ddPCR SARS-CoV-2 Wastewater Quantification Kit to detect SARS-CoV-2 in a community’s wastewater. Other recent launches include molecular qPCR and ddPCR instruments and assays, antibody tests, quality controls, and ddPCR assays to detect SARS-CoV-2 variants of concern. All these developments are likely to have contributed to the company’s second-quarter top line.
However, a decline in the number of COVID-19 cases across many countries compared to the year-ago period is likely to have hit demand for Bio-Rad’s COVID-related products, including molecular qPCR and ddPCR instruments and assays, antibody tests and quality controls, thus impacting the company’s top line.
Moreover, we are cautious about the persistent supply-chain challenge issues, particularly in terms of the supply and cost of plastic raw materials, electronic components as well as rising logistics costs that have been limiting the company’s ability to meet customer demand. Also, the global inflationary situation and labor shortages may hit the company’s margins.
Estimate Picture
The Zacks Consensus Estimate for Bio-Rad’s second-quarter revenues is pegged at $664.6 million, which implies a decline of 7.2% from the year-ago figure.
The consensus estimate for earnings per share is pegged at $2.46, suggesting a fall of 30.5% from the prior-year reported figure.
What Our Model Suggests
Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive
Earnings ESP
has higher chances of beating estimates. However, this is not the case here as you can see:
Earnings ESP:
Bio-Rad has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our
Earnings ESP Filter
.
Zacks Rank:
The company currently carries a Zacks Rank #3.
Stocks Worth a Look
Here are some medical stocks worth considering as these have the right combination of elements to post an earnings beat this quarter.
BrainsWay Ltd.
BWAY
has an Earnings ESP of +33.33% and a Zacks Rank of 2. You can see
the complete list of today’s Zacks #1 Rank stocks here.
BrainsWay’s 2023 earnings growth rate is estimated to be 16.7%. BWAY’s 2023 revenues are expected to growth 17.1% from 2022.
Alcon Inc.
ALC
has an Earnings ESP of +5.07% and a Zacks Rank of #2.
Alcon long-term earnings growth rate is estimated at 14.3%. ALC’s earnings yield of 3.41% compares favorably with the industry’s (8.09%).
QuidelOrtho Corporation
QDEL
currently has an Earnings ESP of +9.17% and a Zacks Rank of #2.
QDEL’s earnings yield of 14.83% compares favorably with the industry’s (-2.63%).
Stay on top of upcoming earnings announcements with the
Zacks Earnings Calendar
.
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