It has been about a month since the last earnings report for Quidel (QDEL Quick QuoteQDEL - Free Report) . Shares have lost about 9.8% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Quidel 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.

QuidelOrtho Q1 Earnings, Revenues Surpass Estimates, Up Y/Y

QuidelOrtho delivered adjusted earnings per share of $11.66 in the first quarter of 2022, up by a huge 166.2% year over year. The figure surpassed the Zacks Consensus Estimate by 25.7%.

The adjustments include expenses related to amortization of intangibles and non-cash stock compensation expenses, among others.

GAAP earnings per share for the quarter was $11.31, reflecting a 176.5% surge from the year-earlier figure.

Revenues in Detail

QuidelOrtho registered revenues of $1 billion in the first quarter, which jumped 167% year over year. The figure surpassed the Zacks Consensus Estimate by 21.8%.

The year-over-year revenue surge was primarily led by significantly higher sales of Rapid Immunoassay products, which were minimally offset by lower sales of Cardiometabolic Immunoassay and Molecular Diagnostic Solutions products.

Total revenues from COVID-19 products increased 211% year over year to $836.1 million. Per management, QuidelOrtho sold over 126 million COVID tests in the first quarter of 2022, including 113 million tests of QuickVue, 12 million tests of Sofia and over two million of all other tests.

Total revenues from Influenza products were $89.1 million, up by a stupendous 443.3% year over year, including $54.2 million of Sofia ABC revenues, $25.4 million of Sofia Flu revenues and $5.9 million of QuickVue flu revenues.

Core business revenues, excluding COVID-19 and Beckman BNP revenues, grew 105% year over year to $149.4 million.

Segments in Detail

QuidelOrtho derives revenues from four product categories — Rapid Immunoassay, Cardiometabolic Immunoassay, Molecular Diagnostic Solutions and Specialized Diagnostic Solutions.

In the first quarter, Rapid Immunoassay revenues surged 275.7% from the year-ago quarter’s level to $892.8 million, primarily driven by significant sales of QuickVue At-Home OTC COVID-19 tests as well as increased sales of Sofia Influenza + SARS and Sofia Influenza tests.

Cardiometabolic Immunoassay revenues were down 24.6% year over year to $50.2 million. This decline was caused by the impact of the transition agreement that QuidelOrtho entered in July 2021 with Beckman Coulter, Inc. for the latter’s BNP assay business. The segment included revenues of $33.4 million from the Triage business (up 1.2% year over year), with strong growth in Asia Pacific and EMEA, offset by a decline in the United States.

Molecular Diagnostic Solutions revenues were $45.9 million, down 23.7%. This included revenues of $38.2 million from the Lyra SARS-CoV-2 products, $5.7 million of Solana system and $0.4 million of Savanna system.

Revenues from Specialized Diagnostic Solutions improved 22.6% year over year to $13.3 million, driven by an increase in sales of QDEL’s DHI (Diagnostic Hybrids) Respiratory products.

Margin Trend

In the quarter under review, QuidelOrtho’s gross profit surged 145.1% to $739.9 million. However, gross margin contracted by a huge 662 basis points (bps) to 73.8%.

Sales and marketing expenses rose 91% to $65.4 million. Research and development expenses went up 13.1% year over year to $26.4 million, while general and administrative expenses climbed 25.6% year over year to $24.5 million. Adjusted operating expenses of $116.3 million increased 50.9% year over year.

Adjusted operating profit totaled $623.7 million, reflecting a 177.3% jump from the prior-year quarter’s level. Adjusted operating margin in the first quarter expanded 231 bps to 62.2%.

Financial Position

QuidelOrtho exited first-quarter 2022 with cash and cash equivalents of $1.28 billion compared with $802.8 million at the end of 2021. Total debt (including short-term debt) at the end of first-quarter 2022 was $0.5 million compared with $0.6 million at the end of 2021.

How Have Estimates Been Moving Since Then?

It turns out, estimates review flatlined during the past month.

VGM Scores

Currently, Quidel has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.

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

Outlook

Quidel has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Quidel belongs to the Zacks Medical - Products industry. Another stock from the same industry, Baxter International (BAX Quick QuoteBAX - Free Report) , has gained 1.7% over the past month. More than a month has passed since the company reported results for the quarter ended March 2022.

Baxter reported revenues of $3.71 billion in the last reported quarter, representing a year-over-year change of +25.8%. EPS of $0.93 for the same period compares with $0.76 a year ago.

Baxter is expected to post earnings of $0.88 per share for the current quarter, representing a year-over-year change of +10%. Over the last 30 days, the Zacks Consensus Estimate has changed +0%.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Baxter. Also, the stock has a VGM Score of B.