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.
QIAGEN (QGEN) Q2 Earnings Top Estimates, Margins Decline
Read MoreHide Full Article
QIAGENN.V.’s (QGEN - Free Report) second-quarter 2022 adjusted earnings per share (EPS) were 51 cents (53 cents at constant exchange rate or CER), down 23.9% year over year. The figure surpassed the Zacks Consensus Estimate by 13.3%.
The bottom line exceeded the company’s second-quarter guidance of at least 46 cents at CER.
The adjustment excludes the impact of certain non-recurring items like business integration, acquisition and restructuring-related expenses, purchased intangibles amortization expenses and non-cash interest expense charges, among others.
GAAP EPS for the quarter was 42 cents per share, down 19.2% year over year.
Revenues in Detail
Net sales in the second quarter fell 9.1% on a year-over-year basis to $515.5 million (down 4% at CER). The top line exceeded the Zacks Consensus Estimate by 3.5%. Sales at CER were $544 million, also exceeding the company’s second-quarter expectation of $510 million at CER.
The second-quarter sales were driven by 10% growth at CER in the non-COVID product portfolio. However, sales of COVID-19 products plunged 39% at CER.
Geographical Revenue Update
In the quarter under review, sales from the Americas (49% of sales) totaled $252 million, down 2% on a reported basis (down 1% at CER).
Revenues from Europe, the Middle East and Africa (31% of sales) fell 21% reportedly (down 10% at CER) to $161 million.
Further, revenues from Asia-Pacific/ Japan (20% of sales) fell 6% year over year on a reported basis (0% at CER) to $102 million.
Segmental Details
As of the second quarter of 2022, QIAGEN had two major customer classes – Molecular Diagnostics and Life Sciences.
Molecular Diagnostics (representing 49% of net sales) revenues were down 6% on a reported basis (0% at CER) to $255 million.
Life Sciences (51% of total revenues) reported revenues of $261 million, down 12% on a reported basis (down 8% at CER).
Operational Update
Adjusted gross profit in the quarter under review fell 10.5% to $346.1 million. Meanwhile, the adjusted gross margin contracted 106 basis points (bps) to 67.1% due to a 6.1% rise in the total cost of sales (adjusting for acquisition-related intangible amortization) to $169.4 million.
Sales and marketing expenses of QIAGEN rose 7.7% to $118.9 million year over year. Research and development expenses contracted 4.3% year over year to $49.9 million, whereas general and administrative expenses rose 4.9% year over year to $32.5 million.
Adjusted operating income (excluding items like acquisition-related intangible amortization, restructuring and integration and asset impairment) declined 25.1% year over year to $144.8 million in the second quarter. Meanwhile, the adjusted operating margin contracted 599 bps to 28.1%.
Financial Update
QIAGEN exited second-quarter 2022 with cash and cash equivalents and short-term investments of $1.31 billion, up from $1.23 billion at the end of first-quarter 2022. Long-term debt was $1.48 billion in second-quarter 2022, slightly up from $1.47 billion at the end of the first quarter.
Cumulative net cash flow from operating activities at the end of second-quarter 2022 was $379.4 million compared with $285 million in the year-ago period.
Guidance
QIAGEN updated its outlook for full-year 2022, reaffirming its previous goal of double-digit CER sales growth from the non-COVID product groups while assuming a significant year-on-year decline in the COVID-19 sales based on the anticipated volatile pandemic trends this year. The updated outlook also considers the current inflation and other macroeconomic issues.
Full-year net sales are expected to be at least $2.2 billion at CER (up from the previously projected $2.12 billion). The Zacks Consensus Estimate for the metric is pegged at $2.08 billion.
Adjusted EPS for 2022 is expected to be at least $2.30 at CER (up from the prior projection of $2.14). The Zacks Consensus Estimate for adjusted EPS is pegged at $2.09.
For the third quarter, the company expects net sales to grow at least $510 million at CER compared with $535 million in the year-ago quarter. The Zacks Consensus Estimate for the same is pegged at $468.4 million.
Adjusted EPS is expected to be at least 48 cents at CER compared with 58 cents in the year-ago quarter. The Zacks Consensus Estimate for adjusted EPS is pegged at 42 cents.
Our Take
QIAGEN ended second-quarter 2022 with better-than-expected earnings and revenues. The improved sales growth in the non-COVID-19 product portfolio contributed to the top line results. An increase in short-term cash level looks promising. Further, the raised full-year 2022 guidance for net sales and EPS indicates this growth momentum to continue.
However, the substantial year-over-year decline in revenues and earnings does not bode well. The lowered sales across the company’s operating segments are discouraging. Contraction of both margins is worrisome as well. A series of current macroeconomic issues, including supply chain disruptions, energy needs and rising inflation, continue to hamper the company’s performance.
Zacks Rank and Key Picks
QIAGEN currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Quest Diagnostics Incorporated (DGX - Free Report) , Medpace Holdings, Inc. (MEDP - Free Report) and Neogen Corporation (NEOG - Free Report) .
Quest Diagnostics, carrying a Zacks Rank #2 (Buy), reported second-quarter 2022 adjusted EPS of $2.36, which beat the Zacks Consensus Estimate by 9.8%. Revenues of $2.45 billion outpaced the consensus mark by 7.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Quest Diagnostics has an earnings yield of 7.2% compared with the industry’s 3.3%. DGX’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average being 12.1%.
Medpace Holdings, having a Zacks Rank #2, reported second-quarter 2022 adjusted EPS of $1.46, which beat the Zacks Consensus Estimate by 8.9%. Revenues of $351.2 million outpaced the consensus mark by 1.3%.
Medpace Holdings has an estimated growth rate of 22.7% for full-year 2022. MEDP’s earnings surpassed estimates in the trailing four quarters, the average being 17.3%.
Neogen reported fourth-quarter fiscal 2022 adjusted EPS of 18 cents, which surpassed the Zacks Consensus Estimate by 12.5%. Fiscal fourth-quarter revenues of $140.1 million outpaced the Zacks Consensus Estimate by 1.3%. It currently has a Zacks Rank #2.
Neogen has an estimated growth rate of 1.6% for fiscal 2023. NEOG’s earnings surpassed estimates in two of the trailing four quarters, lagged the same in one and broke even in the other, the average surprise being 1.5%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
QIAGEN (QGEN) Q2 Earnings Top Estimates, Margins Decline
QIAGEN N.V.’s (QGEN - Free Report) second-quarter 2022 adjusted earnings per share (EPS) were 51 cents (53 cents at constant exchange rate or CER), down 23.9% year over year. The figure surpassed the Zacks Consensus Estimate by 13.3%.
The bottom line exceeded the company’s second-quarter guidance of at least 46 cents at CER.
The adjustment excludes the impact of certain non-recurring items like business integration, acquisition and restructuring-related expenses, purchased intangibles amortization expenses and non-cash interest expense charges, among others.
GAAP EPS for the quarter was 42 cents per share, down 19.2% year over year.
Revenues in Detail
Net sales in the second quarter fell 9.1% on a year-over-year basis to $515.5 million (down 4% at CER). The top line exceeded the Zacks Consensus Estimate by 3.5%. Sales at CER were $544 million, also exceeding the company’s second-quarter expectation of $510 million at CER.
The second-quarter sales were driven by 10% growth at CER in the non-COVID product portfolio. However, sales of COVID-19 products plunged 39% at CER.
Geographical Revenue Update
In the quarter under review, sales from the Americas (49% of sales) totaled $252 million, down 2% on a reported basis (down 1% at CER).
Revenues from Europe, the Middle East and Africa (31% of sales) fell 21% reportedly (down 10% at CER) to $161 million.
QIAGEN N.V. Price, Consensus and EPS Surprise
QIAGEN N.V. price-consensus-eps-surprise-chart | QIAGEN N.V. Quote
Further, revenues from Asia-Pacific/ Japan (20% of sales) fell 6% year over year on a reported basis (0% at CER) to $102 million.
Segmental Details
As of the second quarter of 2022, QIAGEN had two major customer classes – Molecular Diagnostics and Life Sciences.
Molecular Diagnostics (representing 49% of net sales) revenues were down 6% on a reported basis (0% at CER) to $255 million.
Life Sciences (51% of total revenues) reported revenues of $261 million, down 12% on a reported basis (down 8% at CER).
Operational Update
Adjusted gross profit in the quarter under review fell 10.5% to $346.1 million. Meanwhile, the adjusted gross margin contracted 106 basis points (bps) to 67.1% due to a 6.1% rise in the total cost of sales (adjusting for acquisition-related intangible amortization) to $169.4 million.
Sales and marketing expenses of QIAGEN rose 7.7% to $118.9 million year over year. Research and development expenses contracted 4.3% year over year to $49.9 million, whereas general and administrative expenses rose 4.9% year over year to $32.5 million.
Adjusted operating income (excluding items like acquisition-related intangible amortization, restructuring and integration and asset impairment) declined 25.1% year over year to $144.8 million in the second quarter. Meanwhile, the adjusted operating margin contracted 599 bps to 28.1%.
Financial Update
QIAGEN exited second-quarter 2022 with cash and cash equivalents and short-term investments of $1.31 billion, up from $1.23 billion at the end of first-quarter 2022. Long-term debt was $1.48 billion in second-quarter 2022, slightly up from $1.47 billion at the end of the first quarter.
Cumulative net cash flow from operating activities at the end of second-quarter 2022 was $379.4 million compared with $285 million in the year-ago period.
Guidance
QIAGEN updated its outlook for full-year 2022, reaffirming its previous goal of double-digit CER sales growth from the non-COVID product groups while assuming a significant year-on-year decline in the COVID-19 sales based on the anticipated volatile pandemic trends this year. The updated outlook also considers the current inflation and other macroeconomic issues.
Full-year net sales are expected to be at least $2.2 billion at CER (up from the previously projected $2.12 billion). The Zacks Consensus Estimate for the metric is pegged at $2.08 billion.
Adjusted EPS for 2022 is expected to be at least $2.30 at CER (up from the prior projection of $2.14). The Zacks Consensus Estimate for adjusted EPS is pegged at $2.09.
For the third quarter, the company expects net sales to grow at least $510 million at CER compared with $535 million in the year-ago quarter. The Zacks Consensus Estimate for the same is pegged at $468.4 million.
Adjusted EPS is expected to be at least 48 cents at CER compared with 58 cents in the year-ago quarter. The Zacks Consensus Estimate for adjusted EPS is pegged at 42 cents.
Our Take
QIAGEN ended second-quarter 2022 with better-than-expected earnings and revenues. The improved sales growth in the non-COVID-19 product portfolio contributed to the top line results. An increase in short-term cash level looks promising. Further, the raised full-year 2022 guidance for net sales and EPS indicates this growth momentum to continue.
However, the substantial year-over-year decline in revenues and earnings does not bode well. The lowered sales across the company’s operating segments are discouraging. Contraction of both margins is worrisome as well. A series of current macroeconomic issues, including supply chain disruptions, energy needs and rising inflation, continue to hamper the company’s performance.
Zacks Rank and Key Picks
QIAGEN currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Quest Diagnostics Incorporated (DGX - Free Report) , Medpace Holdings, Inc. (MEDP - Free Report) and Neogen Corporation (NEOG - Free Report) .
Quest Diagnostics, carrying a Zacks Rank #2 (Buy), reported second-quarter 2022 adjusted EPS of $2.36, which beat the Zacks Consensus Estimate by 9.8%. Revenues of $2.45 billion outpaced the consensus mark by 7.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Quest Diagnostics has an earnings yield of 7.2% compared with the industry’s 3.3%. DGX’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average being 12.1%.
Medpace Holdings, having a Zacks Rank #2, reported second-quarter 2022 adjusted EPS of $1.46, which beat the Zacks Consensus Estimate by 8.9%. Revenues of $351.2 million outpaced the consensus mark by 1.3%.
Medpace Holdings has an estimated growth rate of 22.7% for full-year 2022. MEDP’s earnings surpassed estimates in the trailing four quarters, the average being 17.3%.
Neogen reported fourth-quarter fiscal 2022 adjusted EPS of 18 cents, which surpassed the Zacks Consensus Estimate by 12.5%. Fiscal fourth-quarter revenues of $140.1 million outpaced the Zacks Consensus Estimate by 1.3%. It currently has a Zacks Rank #2.
Neogen has an estimated growth rate of 1.6% for fiscal 2023. NEOG’s earnings surpassed estimates in two of the trailing four quarters, lagged the same in one and broke even in the other, the average surprise being 1.5%.