We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Haemonetics (HAE) Hospital Arm Thrives, Gross Margin Rises
Read MoreHide Full Article
Haemonetics Corporation (HAE - Free Report) has been gaining strength in its Hospital business. A rebound in plasma collection is an added positive. Currently, Haemonetics carries a Zacks Rank #2 (Buy).
Over the past six months, Haemonetics has outperformed its industry. The stock has gained 6.2% against the industry's 32.1% fall.
Haemonetics ended the fourth quarter of fiscal 2022 with better-than-expected earnings and revenues. During the quarter, the company registered year-over-year growth in revenues, driven by recovery across businesses. The robust performance in the Hospital business on continued strength in the Hemostasis Management product line buoys optimism. Strong customer end-market demand for NexSys PCS system with Persona technology is encouraging. An increase in short-term cash level appears promising.
The expansion of the gross margin is an added advantage. The company-adjusted gross margin was 53.6%, up 360 basis points (bps) year over year. The primary drivers of this improvement were the acquisition of the Vascular Closure business and price and productivity savings from the Operational Excellence Program.
The fiscal fourth quarter saw an encouraging performance by Haemonetics’ businesses, backed by strong procedure recovery in the hospital business, the resilience of blood donors in blood centers, and rollouts of Persona technology and NexSys. Hospital business revenues grew 19% in the quarter, primarily driven by a continued rebound in procedures amid challenges posed by hospital staffing shortages and supply-chain disruptions in the Asia Pacific. Plasma collections also continued to recover during the quarter. The company anticipates strong demand for plasma-derived therapies and capital investments by customers to contribute to the ongoing rebound in plasma collections as the effects of the pandemic fade.
On the flip side, Haemonetics’ sluggish performance in the Blood Center business in the fourth quarter of fiscal 2022 due to the pandemic-led business disruptions is concerning. Blood Center revenues declined 0.9% in the fiscal fourth quarter. Moreover, whole Blood revenues declined 3% due to blood center staffing shortages and previously discontinued customer contracts in North America. In 2023, the company expects Blood Center revenues to decline 4% to 7%.
Adjusted operating expenses in the fiscal fourth quarter were up 16.4% year over year. This increase was primarily due to the acquisition of the Vascular Closure business and an increase in freight costs. Adjusted operating margin was 17.6%, down 410 basis points from the year-ago quarter.
Economic uncertainty and stiff competition remain concerns. The company continues to be challenged by inflationary pressure in the global manufacturing and supply chain, including freight and raw material costs, previous divestitures and price adjustments.
Other Key Picks
A few other top-ranked stocks in the broader medical space that investors can consider are AMN Healthcare Services, Inc. (AMN - Free Report) , Merck & Co., Inc. (MRK - Free Report) and Patterson Companies, Inc. (PDCO - Free Report) .
AMN Healthcare has a long-term earnings growth rate of 1.1%. The company surpassed earnings estimates in the trailing four quarters, delivering a surprise of 15.6%, on average. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcare has outperformed its industry in the past year. AMN has gained 20.1% against the industry’s 33.3% fall.
Merck has a long-term earnings growth rate of 10.1%. The company surpassed earnings estimates in the trailing three quarters and missed in one, delivering a surprise of 13.4%, on average. It currently carries a Zacks Rank #1.
Merck has outperformed its industry in the past year. MRK has gained 21.5% against the industry’s 16.1% growth.
Patterson Companies has an estimated long-term growth rate of 9.6%. The company’s earnings surpassed estimates in all the trailing four quarters, the average beat being 16.5%. It currently has a Zacks Rank #2 (Buy).
Patterson Companies has outperformed its industry in the past year. PDCO has lost 1% compared with the industry’s 10.9% fall in the past year.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Haemonetics (HAE) Hospital Arm Thrives, Gross Margin Rises
Haemonetics Corporation (HAE - Free Report) has been gaining strength in its Hospital business. A rebound in plasma collection is an added positive. Currently, Haemonetics carries a Zacks Rank #2 (Buy).
Over the past six months, Haemonetics has outperformed its industry. The stock has gained 6.2% against the industry's 32.1% fall.
Haemonetics ended the fourth quarter of fiscal 2022 with better-than-expected earnings and revenues. During the quarter, the company registered year-over-year growth in revenues, driven by recovery across businesses. The robust performance in the Hospital business on continued strength in the Hemostasis Management product line buoys optimism. Strong customer end-market demand for NexSys PCS system with Persona technology is encouraging. An increase in short-term cash level appears promising.
The expansion of the gross margin is an added advantage. The company-adjusted gross margin was 53.6%, up 360 basis points (bps) year over year. The primary drivers of this improvement were the acquisition of the Vascular Closure business and price and productivity savings from the Operational Excellence Program.
The fiscal fourth quarter saw an encouraging performance by Haemonetics’ businesses, backed by strong procedure recovery in the hospital business, the resilience of blood donors in blood centers, and rollouts of Persona technology and NexSys. Hospital business revenues grew 19% in the quarter, primarily driven by a continued rebound in procedures amid challenges posed by hospital staffing shortages and supply-chain disruptions in the Asia Pacific. Plasma collections also continued to recover during the quarter. The company anticipates strong demand for plasma-derived therapies and capital investments by customers to contribute to the ongoing rebound in plasma collections as the effects of the pandemic fade.
Haemonetics Corporation Price
Haemonetics Corporation price | Haemonetics Corporation Quote
On the flip side, Haemonetics’ sluggish performance in the Blood Center business in the fourth quarter of fiscal 2022 due to the pandemic-led business disruptions is concerning. Blood Center revenues declined 0.9% in the fiscal fourth quarter. Moreover, whole Blood revenues declined 3% due to blood center staffing shortages and previously discontinued customer contracts in North America. In 2023, the company expects Blood Center revenues to decline 4% to 7%.
Adjusted operating expenses in the fiscal fourth quarter were up 16.4% year over year. This increase was primarily due to the acquisition of the Vascular Closure business and an increase in freight costs. Adjusted operating margin was 17.6%, down 410 basis points from the year-ago quarter.
Economic uncertainty and stiff competition remain concerns. The company continues to be challenged by inflationary pressure in the global manufacturing and supply chain, including freight and raw material costs, previous divestitures and price adjustments.
Other Key Picks
A few other top-ranked stocks in the broader medical space that investors can consider are AMN Healthcare Services, Inc. (AMN - Free Report) , Merck & Co., Inc. (MRK - Free Report) and Patterson Companies, Inc. (PDCO - Free Report) .
AMN Healthcare has a long-term earnings growth rate of 1.1%. The company surpassed earnings estimates in the trailing four quarters, delivering a surprise of 15.6%, on average. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcare has outperformed its industry in the past year. AMN has gained 20.1% against the industry’s 33.3% fall.
Merck has a long-term earnings growth rate of 10.1%. The company surpassed earnings estimates in the trailing three quarters and missed in one, delivering a surprise of 13.4%, on average. It currently carries a Zacks Rank #1.
Merck has outperformed its industry in the past year. MRK has gained 21.5% against the industry’s 16.1% growth.
Patterson Companies has an estimated long-term growth rate of 9.6%. The company’s earnings surpassed estimates in all the trailing four quarters, the average beat being 16.5%. It currently has a Zacks Rank #2 (Buy).
Patterson Companies has outperformed its industry in the past year. PDCO has lost 1% compared with the industry’s 10.9% fall in the past year.