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Reasons to Retain QuidelOrtho Stock in Your Portfolio for Now
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QuidelOrtho Corporation (QDEL - Free Report) is well-poised for growth in the coming quarters, courtesy of its strong product portfolio. The optimism, led by a solid first-half 2024 performance and its continued spending on research and development (R&D), is expected to contribute further. However, headwinds due to data security threats and reimbursement policies persist.
This Zacks Rank #3 (Hold) company has lost 42.6% year to date against 12.4% growth of the industry. The S&P 500 has witnessed 18.5% growth in the said time frame.
The renowned rapid diagnostic testing solutions provider has a market capitalization of $2.84 billion. QuidelOrtho’s earnings yield of 4.3% compares favorably with the industry’s 0.7%. The company’s earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed the same in one, the average surprise being 31.73%.
Image Source: Zacks Investment Research
Let’s delve deeper.
Upsides
Strong Product Portfolio: We are upbeat about QuidelOrtho’s current product clientele. It sells its products directly to end users and distributors for professional use in physician offices and hospitals, among others, as well as for individual, non-professional, over-the-counter use. QuidelOrtho’s diagnostic testing solutions include the Sofia and Sofia 2 Analyzers, QuickVue, InflammaDry and AdenoPlus products.
In April 2024, QuidelOrtho announced the addition of the ARK Fentanyl II Assay to its U.S. Vitros XT 7600 and 5600 Integrated Systems as well as its Vitros 4600 Chemistry System menu of assays as a MicroTip Partnership Assay. The Fentanyl assay is expected to aid hospital and emergency room customers in response to the critical demand for enhanced opioid testing. This addition is likely to significantly boost QuidelOrtho’s Labs business unit across the United States.
The company also announced the FDA 510(k) clearance for its QuickVue COVID-19 test. With CLIA certificates of waiver, this approval grants permission for the test to be used accurately and conveniently in home and medical healthcare settings.
In March 2024, the company announced the receipt of Health Canada’s approval for its Triage PLGF (placental growth factor) test for laboratory use in Canada. The test is intended to detect the presence of angiogenic imbalance, which may lead to maternal and fetal complications of pregnancy, including pre-eclampsia. The latest regulatory approval is likely to significantly boost QuidelOrtho’s Point of Care business.
Continued Spend on R&D: QDEL’s long-term growth and profitability will depend, in part, on its ability to retain and grow its current customers and attract new ones by developing and delivering innovative and improved products and services that meet customers’ needs and expectations. As a result, QuidelOrtho’s management expects to continue to maintain its emphasis on R&D investments for long-term growth, including its next-generation platforms and assays, as well as additional assays that are set to be launched on its current platforms.
Strong H1 Results: QuidelOrtho’s earnings and revenues beat the Zacks Consensus Estimate in the first two quarters of 2024. Excluding the COVID-19 revenue impact, the company witnessed growth in total revenues. Excluding the one-time third-party collaboration settlement in the year-ago period, the company registered revenue growth in its Labs segment. Growth in China and Other regions, excluding COVID-19 revenues, was encouraging. QuidelOrtho also recorded strong revenue growth in the EMEA region, which buoys optimism.
Downsides
Data Security Threats: QuidelOrtho utilizes complex information technology systems to transmit and store information, including proprietary information, to support its business and process. In the future, these systems may prove inadequate to its business needs and necessary upgrades may not operate as designed, resulting in high costs or disruptions in portions of the company’s business.
Third-Party Reimbursement Policies: The end-users of QuidelOrtho’s POC products are primarily physicians and other healthcare providers. In the United States, healthcare providers like hospitals and physicians who purchase diagnostic products generally rely on third-party payers (mainly private health insurance plans, federal Medicare and state Medicaid) to reimburse all or part of the cost of the procedure. The use of QuidelOrtho’s products would be affected if physicians and other healthcare providers do not receive adequate reimbursement for the cost of the company’s products from their patients’ third-party payers.
Estimate Trend
QuidelOrtho is witnessing a stable estimate revision trend for 2024. In the past seven days, the Zacks Consensus Estimate for its earnings has remained stable at $1.80 per share.
The Zacks Consensus Estimate for the company’s third-quarter 2024 revenues is pegged at $648.2 million, indicating a 12.9% decline from the year-ago quarter’s reported number.
Some better-ranked stocks in the broader medical space that have announced quarterly results are Boston Scientific (BSX - Free Report) , Apyx Medical (APYX - Free Report) and Universal Health Services (UHS - Free Report) , each carrying a Zacks Rank #2 (Buy) at present.
Boston Scientific’s shares have risen 41.4% year to date compared with the industry’s 12.3% growth.
Apyx Medicalhas an estimated growth rate of 20% for 2025. Its earnings missed estimates in each of the trailing four quarters, delivering a negative average surprise of 25.98%.
Apyx Medical’s shares have lost 49.3% year to date against the industry’s 12.3% growth.
Universal Health Services has a long-term estimated growth rate of 19%. UHS’ earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.58%.
Universal Health Services’ shares have risen 56.1% year to date compared with the industry’s 48% growth.
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Reasons to Retain QuidelOrtho Stock in Your Portfolio for Now
QuidelOrtho Corporation (QDEL - Free Report) is well-poised for growth in the coming quarters, courtesy of its strong product portfolio. The optimism, led by a solid first-half 2024 performance and its continued spending on research and development (R&D), is expected to contribute further. However, headwinds due to data security threats and reimbursement policies persist.
This Zacks Rank #3 (Hold) company has lost 42.6% year to date against 12.4% growth of the industry. The S&P 500 has witnessed 18.5% growth in the said time frame.
The renowned rapid diagnostic testing solutions provider has a market capitalization of $2.84 billion. QuidelOrtho’s earnings yield of 4.3% compares favorably with the industry’s 0.7%. The company’s earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed the same in one, the average surprise being 31.73%.
Image Source: Zacks Investment Research
Let’s delve deeper.
Upsides
Strong Product Portfolio: We are upbeat about QuidelOrtho’s current product clientele. It sells its products directly to end users and distributors for professional use in physician offices and hospitals, among others, as well as for individual, non-professional, over-the-counter use. QuidelOrtho’s diagnostic testing solutions include the Sofia and Sofia 2 Analyzers, QuickVue, InflammaDry and AdenoPlus products.
In April 2024, QuidelOrtho announced the addition of the ARK Fentanyl II Assay to its U.S. Vitros XT 7600 and 5600 Integrated Systems as well as its Vitros 4600 Chemistry System menu of assays as a MicroTip Partnership Assay. The Fentanyl assay is expected to aid hospital and emergency room customers in response to the critical demand for enhanced opioid testing. This addition is likely to significantly boost QuidelOrtho’s Labs business unit across the United States.
The company also announced the FDA 510(k) clearance for its QuickVue COVID-19 test. With CLIA certificates of waiver, this approval grants permission for the test to be used accurately and conveniently in home and medical healthcare settings.
In March 2024, the company announced the receipt of Health Canada’s approval for its Triage PLGF (placental growth factor) test for laboratory use in Canada. The test is intended to detect the presence of angiogenic imbalance, which may lead to maternal and fetal complications of pregnancy, including pre-eclampsia. The latest regulatory approval is likely to significantly boost QuidelOrtho’s Point of Care business.
Continued Spend on R&D: QDEL’s long-term growth and profitability will depend, in part, on its ability to retain and grow its current customers and attract new ones by developing and delivering innovative and improved products and services that meet customers’ needs and expectations. As a result, QuidelOrtho’s management expects to continue to maintain its emphasis on R&D investments for long-term growth, including its next-generation platforms and assays, as well as additional assays that are set to be launched on its current platforms.
Strong H1 Results: QuidelOrtho’s earnings and revenues beat the Zacks Consensus Estimate in the first two quarters of 2024. Excluding the COVID-19 revenue impact, the company witnessed growth in total revenues. Excluding the one-time third-party collaboration settlement in the year-ago period, the company registered revenue growth in its Labs segment. Growth in China and Other regions, excluding COVID-19 revenues, was encouraging. QuidelOrtho also recorded strong revenue growth in the EMEA region, which buoys optimism.
Downsides
Data Security Threats: QuidelOrtho utilizes complex information technology systems to transmit and store information, including proprietary information, to support its business and process. In the future, these systems may prove inadequate to its business needs and necessary upgrades may not operate as designed, resulting in high costs or disruptions in portions of the company’s business.
Third-Party Reimbursement Policies: The end-users of QuidelOrtho’s POC products are primarily physicians and other healthcare providers. In the United States, healthcare providers like hospitals and physicians who purchase diagnostic products generally rely on third-party payers (mainly private health insurance plans, federal Medicare and state Medicaid) to reimburse all or part of the cost of the procedure. The use of QuidelOrtho’s products would be affected if physicians and other healthcare providers do not receive adequate reimbursement for the cost of the company’s products from their patients’ third-party payers.
Estimate Trend
QuidelOrtho is witnessing a stable estimate revision trend for 2024. In the past seven days, the Zacks Consensus Estimate for its earnings has remained stable at $1.80 per share.
The Zacks Consensus Estimate for the company’s third-quarter 2024 revenues is pegged at $648.2 million, indicating a 12.9% decline from the year-ago quarter’s reported number.
QuidelOrtho Corporation Price
QuidelOrtho Corporation price | QuidelOrtho Corporation Quote
Key Picks
Some better-ranked stocks in the broader medical space that have announced quarterly results are Boston Scientific (BSX - Free Report) , Apyx Medical (APYX - Free Report) and Universal Health Services (UHS - Free Report) , each carrying a Zacks Rank #2 (Buy) at present.
Boston Scientific has a long-term estimated growth rate of 12.6%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.2%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Boston Scientific’s shares have risen 41.4% year to date compared with the industry’s 12.3% growth.
Apyx Medicalhas an estimated growth rate of 20% for 2025. Its earnings missed estimates in each of the trailing four quarters, delivering a negative average surprise of 25.98%.
Apyx Medical’s shares have lost 49.3% year to date against the industry’s 12.3% growth.
Universal Health Services has a long-term estimated growth rate of 19%. UHS’ earnings surpassed estimates in each of the trailing four quarters, the average surprise being 14.58%.
Universal Health Services’ shares have risen 56.1% year to date compared with the industry’s 48% growth.