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Here's Why You Should Add Hologic (HOLX) to Your Portfolio

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Hologic, Inc. (HOLX - Free Report) has been on a solid growth trajectory of late, courtesy of strong pipeline of products as well as huge prospects in the GYN Surgical and Molecular Diagnostics segments

The company has outperformed the industry in the past year. The stock has improved 24.3% compared with the industry’s 1.8% rise and the S&P 500’s 5% rise.

The global leader of women’s healthcare has a market cap of $13.19 billion. The company’s expected growth rate for three to five years is 8.9%.

Banking on solid prospects, this Zacks Rank #2 (Buy) stock has solid prospects in the near term.You can see the complete list of today’s Zacks #1(Strong Buy) Rank stocks here.

Molecular Diagnostics Sees Consistent GrowthHologic’s management is impressed with consistent growth in the core Molecular Diagnostics sub-segment. Global growth is driven by expanding market share and utilization of fully automated Panther system. Also, strong uptake of Aptima women's health products is driving the segment.

GYN Surgical Continues to See Growth:  The company has registered solid quarterly results on the back of MyoSure. The company is seeing strong market adoption of its advanced three-in-one modular scope — Omni hysteroscope — following its U.S. launch in December 2018.

Growth InitiativesIn order to streamline operations and reduce cost of revenues, the company is adopting a few significant strategies over the past few years. These include Hologic’s Genius marketing campaign in Breast Health, cervical cancer co-testing initiatives in Diagnostics along with efforts to gain competitive market share with NovaSure. Moreover, the company is strengthening product portfolio through recent launches of 3Dimensions and 3D Performance gantries, Intelligent 2D, Clarity HD, SmartCurve, Affirm prone biopsy system and Brevera biopsy system. Moreover, the company announced the global commercial availability of the Trident HD specimen radiography system.

Which Way are Estimates Treading?

For the third quarter of fiscal 2019, the Zacks Consensus Estimate for earnings is pegged at 61 cents, which indicates 5.2% growth from the year-ago quarter’s figure. The same for revenues is pegged at $834.6 million, calling for year-over-year growth of 1.3%.

For 2019, the Zacks Consensus Estimate for earnings is pegged at $2.42, suggesting 8.5% year-over-year growth. The same for revenues is pegged at $3.33 billion, indicating 3.5% rise from the prior-year quarter’s level.

Other Key Picks

Some other top-ranked stocks in the broader medical space are Cerner Corporation , Penumbra (PEN - Free Report) and Bruker Corporation (BRKR - Free Report) . Each of these stocks carry a Zacks Rank #2.

Cerner’s long-term earnings growth rate is expected to be 13.5%.

Penumbra’s long-term earnings growth rate is projected at 21.5%.

Bruker’s long-term earnings growth rate is estimated at 11.7%.

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