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.
Here's Why You Should Retain OPKO Health Stock in Your Portfolio
Read MoreHide Full Article
OPKO Health, Inc. (OPK - Free Report) is well-poised for growth in the coming quarters, courtesy of its potential in RAYALDEE. The optimism surrounding the stock is backed by RAYALDEE’s performance and strategic partnerships. However, stiff competition and overdependence on RAYALDEE are concerns.
Shares of this Zacks Rank #3 (Hold) company have lost 1.3% year to date against the industry's 9.8% growth. The S&P 500 has gained 21% in the said time frame.
This renowned multinational biopharmaceutical and diagnostics company has a market capitalization of $1.03 billion. It projects 44.4% growth for 2025 and expects to maintain its strong performance. In the trailing four quarters, OPKO Health surpassed earnings estimates once, matched estimates once and missed on two occasions, the average beat being 8.34%.
Image Source: Zacks Investment Research
Factors Favoring OPK Stock
Potential of RAYALDEE: It has been a key driver of OPKO Health's pharmaceutical performance, leading the U.S. renal market for the past two years as the only FDA-approved therapy for secondary hyperparathyroidism (SHPT) in adults with stage 3 or 4 chronic kidney disease and vitamin D insufficiency. Strong sales efforts and new evidence of its potential to improve patient outcomes drive its momentum.
On the second-quarter 2024 earnings call, management confirmed Rayaldee's steady performance. Our model projects the bottom line to witness a CAGR of 7.4% between 2023 and 2026, while Product revenues are expected to witness a 1.5% CAGR.
Strategic Agreements: OPKO Health's strategic agreements boost its financial stability and growth potential. A $250 million deal with HealthCare Royalty allows OPKO to retain a significant profit share from Pfizer’s NGENLA, with the potential for $100 million in milestone payments. In March, OPKO sold its BioReference Health assets to Labcorp, focusing on oncology and urology diagnostics. Its global partnership with Pfizer for NGENLA, approved in over 50 markets, supports OPKO’s long-term performance, with both companies developing new licensed products. These agreements enhance OPKO’s position in the diagnostics and pharmaceutical markets.
Bioreference: OPKO Health’s diagnostics arm, led by BioReference, is key to its performance, serving nine million customers in 2023. BioReference offers extensive testing, including the 4Kscore prostate cancer test, and services in molecular diagnostics and women’s health. In second-quarter 2024, OPKO expanded its oncology offerings with new IHC stains and advanced testing platforms. It plans to launch the MDX2001 immune modulator in clinical trials next year. Diagnostics revenues grew 1.9%, driven by oncology, reinforcing OPKO’s growth in diagnostics.
Downsides
Stiff Competition: OPKO Health faces significant competition in both its pharmaceutical and diagnostics businesses. Major pharmaceutical, diagnostic companies and research institutions have much larger financial and operational resources, enabling them to invest heavily in R&D and marketing, often over a broader revenue base. Competitors like Quest Diagnostics and Laboratory Corporation of America dominate the diagnostics sector, making it challenging for OPKO to compete. This disparity in resources and reach may limit OPKO's ability to innovate and scale as effectively as its larger rivals, potentially hindering its growth and market share.
Overdependence on RAYALDEE: OPKO Health's financial success depends heavily on the commercialization of Rayaldee, its only approved pharmaceutical product in the United States. Failure to effectively market Rayaldee could severely impact the company's revenues, profitability and overall business operations. Additionally, Rayaldee's market reputation, safety and perceived efficacy are crucial. Any negative publicity, safety concerns, or rumors about the product could significantly harm OPKO's business, undermining the product's acceptance and damaging the company's financial outlook.
Estimate Trend
OPKO Health is witnessing a positive estimate revision trend for 2024. In the past 90 days, the Zacks Consensus Estimate for its loss has narrowed from 36 cents to 29 cents per share.
The Zacks Consensus Estimate for the company’s third-quarter 2024 revenues and loss per share is pegged at $181.3 million and 10 cents, respectively. The revenue estimate suggests 1.5% growth from the year-ago quarter’s reported number.
Some better-ranked stocks in the broader medical space are Tenet HealthCare(THC - Free Report) , ATI Physical Therapy (ATIP - Free Report) and Aveanna Healthcare (AVAH - Free Report) . While Tenet HealthCare sports a Zacks Rank #1 (Strong Buy), ATI Physical Therapy and Aveanna Healthcare carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Tenet HealthCare has an estimated long-term growth rate of 18.3%. THC's earnings surpassed estimates in each of the trailing four quarters, with the average being 58.5%.
Tenet HealthCare has gained 119.9% compared with the industry's 48.6% growth year to date.
ATI Physical Therapy's earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 7.25%.
ATIP's shares have gained 5.5% year to date compared with the industry’s 18.6% growth.
Aveanna Healthcare's earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 47.5%.
AVAH's shares have surged 104.5% year to date compared with the industry’s 15.7% growth.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Here's Why You Should Retain OPKO Health Stock in Your Portfolio
OPKO Health, Inc. (OPK - Free Report) is well-poised for growth in the coming quarters, courtesy of its potential in RAYALDEE. The optimism surrounding the stock is backed by RAYALDEE’s performance and strategic partnerships. However, stiff competition and overdependence on RAYALDEE are concerns.
Shares of this Zacks Rank #3 (Hold) company have lost 1.3% year to date against the industry's 9.8% growth. The S&P 500 has gained 21% in the said time frame.
This renowned multinational biopharmaceutical and diagnostics company has a market capitalization of $1.03 billion. It projects 44.4% growth for 2025 and expects to maintain its strong performance. In the trailing four quarters, OPKO Health surpassed earnings estimates once, matched estimates once and missed on two occasions, the average beat being 8.34%.
Image Source: Zacks Investment Research
Factors Favoring OPK Stock
Potential of RAYALDEE: It has been a key driver of OPKO Health's pharmaceutical performance, leading the U.S. renal market for the past two years as the only FDA-approved therapy for secondary hyperparathyroidism (SHPT) in adults with stage 3 or 4 chronic kidney disease and vitamin D insufficiency. Strong sales efforts and new evidence of its potential to improve patient outcomes drive its momentum.
On the second-quarter 2024 earnings call, management confirmed Rayaldee's steady performance. Our model projects the bottom line to witness a CAGR of 7.4% between 2023 and 2026, while Product revenues are expected to witness a 1.5% CAGR.
Strategic Agreements: OPKO Health's strategic agreements boost its financial stability and growth potential. A $250 million deal with HealthCare Royalty allows OPKO to retain a significant profit share from Pfizer’s NGENLA, with the potential for $100 million in milestone payments. In March, OPKO sold its BioReference Health assets to Labcorp, focusing on oncology and urology diagnostics. Its global partnership with Pfizer for NGENLA, approved in over 50 markets, supports OPKO’s long-term performance, with both companies developing new licensed products. These agreements enhance OPKO’s position in the diagnostics and pharmaceutical markets.
Bioreference: OPKO Health’s diagnostics arm, led by BioReference, is key to its performance, serving nine million customers in 2023. BioReference offers extensive testing, including the 4Kscore prostate cancer test, and services in molecular diagnostics and women’s health. In second-quarter 2024, OPKO expanded its oncology offerings with new IHC stains and advanced testing platforms. It plans to launch the MDX2001 immune modulator in clinical trials next year. Diagnostics revenues grew 1.9%, driven by oncology, reinforcing OPKO’s growth in diagnostics.
Downsides
Stiff Competition: OPKO Health faces significant competition in both its pharmaceutical and diagnostics businesses. Major pharmaceutical, diagnostic companies and research institutions have much larger financial and operational resources, enabling them to invest heavily in R&D and marketing, often over a broader revenue base. Competitors like Quest Diagnostics and Laboratory Corporation of America dominate the diagnostics sector, making it challenging for OPKO to compete. This disparity in resources and reach may limit OPKO's ability to innovate and scale as effectively as its larger rivals, potentially hindering its growth and market share.
Overdependence on RAYALDEE: OPKO Health's financial success depends heavily on the commercialization of Rayaldee, its only approved pharmaceutical product in the United States. Failure to effectively market Rayaldee could severely impact the company's revenues, profitability and overall business operations. Additionally, Rayaldee's market reputation, safety and perceived efficacy are crucial. Any negative publicity, safety concerns, or rumors about the product could significantly harm OPKO's business, undermining the product's acceptance and damaging the company's financial outlook.
Estimate Trend
OPKO Health is witnessing a positive estimate revision trend for 2024. In the past 90 days, the Zacks Consensus Estimate for its loss has narrowed from 36 cents to 29 cents per share.
The Zacks Consensus Estimate for the company’s third-quarter 2024 revenues and loss per share is pegged at $181.3 million and 10 cents, respectively. The revenue estimate suggests 1.5% growth from the year-ago quarter’s reported number.
OPKO Health, Inc. Price
OPKO Health, Inc. price | OPKO Health, Inc. Quote
Key Picks
Some better-ranked stocks in the broader medical space are Tenet HealthCare (THC - Free Report) , ATI Physical Therapy (ATIP - Free Report) and Aveanna Healthcare (AVAH - Free Report) . While Tenet HealthCare sports a Zacks Rank #1 (Strong Buy), ATI Physical Therapy and Aveanna Healthcare carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Tenet HealthCare has an estimated long-term growth rate of 18.3%. THC's earnings surpassed estimates in each of the trailing four quarters, with the average being 58.5%.
Tenet HealthCare has gained 119.9% compared with the industry's 48.6% growth year to date.
ATI Physical Therapy's earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 7.25%.
ATIP's shares have gained 5.5% year to date compared with the industry’s 18.6% growth.
Aveanna Healthcare's earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 47.5%.
AVAH's shares have surged 104.5% year to date compared with the industry’s 15.7% growth.