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Pacific Biosciences (PACB) Down 0.1% Since Last Earnings Report: Can It Rebound?

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It has been about a month since the last earnings report for Pacific Biosciences of California (PACB - Free Report) . Shares have lost about 0.1% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Pacific Biosciences due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

PacBio’s Q2 Earnings Miss Estimates, Revenues Top

PacBio delivered loss per share of 21 cents in the second quarter of 2021, wider than the year-ago loss of 15 cents per share. The figure was also wider than the Zacks Consensus Estimate of loss of 20 cents per share.

Revenues in Detail

PacBio registered revenues of $30.6 million in the second quarter, up 79.2% year over year. The figure surpassed the Zacks Consensus Estimate by 0.5%.

The year-over-year uptick was partly driven by robust consumable sales.

Sequentially, the top line improved 6%.

Segmental Analysis

Product Revenues amounted to $26.5 million, up 92.9% from the prior-year quarter.

PacBio placed 38 Sequel II/IIe systems during the second quarter of 2021 compared to 23 Sequel II systems in the year-ago quarter. This brings the total installed base of Sequel II/IIe systems to 282 as of June 30, 2021 compared with 148 as of June 30, 2020.

Instrument revenues for the second quarter of 2021 were $14.3 million, up 60.7% year over year.

Consumables revenues for the second quarter of 2021 were $12.2 million, up 154.2% from the prior-year quarter.

Service and Other Revenues came in at $4.1 million, up 22.8% year over year.

Margin Trend

In the quarter under review, PacBio’s gross profit rose 107.9% to $13.8 million. Gross margin expanded 621 basis points (bps) to 44.9%.

Selling, general & administrative expenses rose 92.1% to $29.1 million. Research and development expenses went up 48.3% year over year to $22.3 million. Total operating expenses of $51.3 million surged 70.3% year over year.

Total operating loss totaled $37.6 million in the reported quarter compared with the prior-year quarter’s total operating loss of $23.5 million.

Financial Position

PacBio exited the second quarter of 2021 with cash, cash equivalents and investments (excluding short and long-term restricted cash) of $1.14 billion compared with $1.16 billion at the end of the first quarter.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended downward during the past month. The consensus estimate has shifted -5% due to these changes.

VGM Scores

Currently, Pacific Biosciences has a poor Growth Score of F, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Pacific Biosciences has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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