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Why Is Omnicell (OMCL) Up 3.3% Since the Last Earnings Report?
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It has been about a month since the last earnings report for Omnicell, Inc. (OMCL - Free Report) . Shares have added about 3.3% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Omnicell Q1 Loss Narrower than Expected, Revenues Lag
Omnicell reported a loss of $0.29 in first-quarter 2017 earnings per share (EPS), a deterioration from the year-ago loss of $0.01. The Zacks Consensus Estimate is pegged at a loss of $0.30 per share.
Considering stock-based compensation expense as a regular one adjusted loss per share however came in at $0.06, compared to earnings $0.27 in the year ago quarter.
Revenues in Detail
Revenues during the first quarter have declined 11.9% year over year to $150.6 million, missing the Zacks Consensus Estimate of $152 million. According to management, the company has become a strong player through its differentiated platform and pioneering products including the XT Series. In the reported quarter, the company witnessed strong customer acceptance of its new XT Series products.
On a segmental basis, Omnicell’s Automation and Analytics segment’s revenues decreased 16.6% year over year during the first quarter to $124.2 million.
However, revenues at the Medication Adherence segment improved by 19.6% year over year to $26.4 million.
Operational Update
Omnicell's gross profit during the reported quarter was down 19.6% to $64.2 million. Gross margin, contracted 412 basis points (bps) to 42.6%. According to the company, the adjusted gross margin in the first quarter came in at 46.4%, a contraction of 500 bps year over year.
SG&A expenses in the first quarter increased 0.5% year over year to $64.6 million. Research and development increased 21.8% year over year to $16.8 million. Operating expense was $81.4 million in the first quarter up 4.2% year over year. The escalated operating expenses in the first quarter resulted in operating loss of $0.7 million, as compared to operating income of $20.8 million in the year-ago period.
According to the company, the adjusted operating income in the quarter was $70.8 million up 3.4% from the year ago quarter.
Financial Update
Omnicell exited first quarter 2017 with cash and cash equivalents of $46.3 million, compared with $54.5 million at the end of fiscal 2016.
2017 Guidance
For full-year 2017, Omnicell expects product bookings in the range of $570–$590 million (unchanged from the earlier forecast). The company however lowered its adjusted revenue to a new band of $720 million to $740 million, from earlier range of $740 million and $760 million. Adjusted earnings guidance has also been lowered to the band of $1.22 to $1.34 per share from earlier range of $1.32–$1.42.
The company also initiated its second quarter of 2017 guidance. Management expects adjusted revenue in the band of $172 million to $178 million. Omnicell expects second-quarter 2017 adjusted earnings between $0.21 to $0.27 (earlier it was 0-$0.04 per share).
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
At this time, Omnicell's stock has a great Growth Score of 'A', though it is lagging a lot on the momentum front with a 'F'. Charting a somewhat similar path, the stock was allocated a grade of 'C' on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'B'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for growth investors than value investors.
Outlook
The stock has a Zacks Rank #4 (Sell). We are looking for a below average return from the stock in the next few months.
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Why Is Omnicell (OMCL) Up 3.3% Since the Last Earnings Report?
It has been about a month since the last earnings report for Omnicell, Inc. (OMCL - Free Report) . Shares have added about 3.3% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Omnicell Q1 Loss Narrower than Expected, Revenues Lag
Omnicell reported a loss of $0.29 in first-quarter 2017 earnings per share (EPS), a deterioration from the year-ago loss of $0.01. The Zacks Consensus Estimate is pegged at a loss of $0.30 per share.
Considering stock-based compensation expense as a regular one adjusted loss per share however came in at $0.06, compared to earnings $0.27 in the year ago quarter.
Revenues in Detail
Revenues during the first quarter have declined 11.9% year over year to $150.6 million, missing the Zacks Consensus Estimate of $152 million.
According to management, the company has become a strong player through its differentiated platform and pioneering products including the XT Series. In the reported quarter, the company witnessed strong customer acceptance of its new XT Series products.
On a segmental basis, Omnicell’s Automation and Analytics segment’s revenues decreased 16.6% year over year during the first quarter to $124.2 million.
However, revenues at the Medication Adherence segment improved by 19.6% year over year to $26.4 million.
Operational Update
Omnicell's gross profit during the reported quarter was down 19.6% to $64.2 million. Gross margin, contracted 412 basis points (bps) to 42.6%. According to the company, the adjusted gross margin in the first quarter came in at 46.4%, a contraction of 500 bps year over year.
SG&A expenses in the first quarter increased 0.5% year over year to $64.6 million. Research and development increased 21.8% year over year to $16.8 million. Operating expense was $81.4 million in the first quarter up 4.2% year over year. The escalated operating expenses in the first quarter resulted in operating loss of $0.7 million, as compared to operating income of $20.8 million in the year-ago period.
According to the company, the adjusted operating income in the quarter was $70.8 million up 3.4% from the year ago quarter.
Financial Update
Omnicell exited first quarter 2017 with cash and cash equivalents of $46.3 million, compared with $54.5 million at the end of fiscal 2016.
2017 Guidance
For full-year 2017, Omnicell expects product bookings in the range of $570–$590 million (unchanged from the earlier forecast). The company however lowered its adjusted revenue to a new band of $720 million to $740 million, from earlier range of $740 million and $760 million. Adjusted earnings guidance has also been lowered to the band of $1.22 to $1.34 per share from earlier range of $1.32–$1.42.
The company also initiated its second quarter of 2017 guidance. Management expects adjusted revenue in the band of $172 million to $178 million. Omnicell expects second-quarter 2017 adjusted earnings between $0.21 to $0.27 (earlier it was 0-$0.04 per share).
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
Omnicell, Inc. Price and Consensus
Omnicell, Inc. Price and Consensus | Omnicell, Inc. Quote
VGM Scores
At this time, Omnicell's stock has a great Growth Score of 'A', though it is lagging a lot on the momentum front with a 'F'. Charting a somewhat similar path, the stock was allocated a grade of 'C' on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'B'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for growth investors than value investors.
Outlook
The stock has a Zacks Rank #4 (Sell). We are looking for a below average return from the stock in the next few months.