Hologic Reports Strong Q4 and FY2024 Results, Optimistic for 2025

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Hologic Reports Strong Q4 and FY2024 Results, Optimistic for 2025

Medical technology company Hologic, Inc. (HOLX) delivered strong performance in the fourth quarter and throughout the fiscal year 2024. Total revenue for the fourth quarter was $987.9 million, with adjusted earnings per share (EPS) at $1.01, exceeding the company’s previous forecasts.

For the fiscal year 2024, Hologic achieved revenue of $4.03 billion and $4.08 in adjusted earnings per share. The company highlighted growth in its Molecular Diagnostics segment, excluding COVID-related revenues, and strategic acquisitions as key driving forces.

Looking ahead to fiscal year 2025, Hologic anticipates revenue between $1.025 billion and $1.035 billion for the first quarter, and between $4.15 billion and $4.20 billion for the entire year. Earnings per share are expected to be between $4.25 and $4.35.

The company is optimistic about future growth, particularly in international markets, and plans to continue leveraging its product portfolio and mergers and acquisitions (M&A) strategy.

Key Points:

  • Hologic's fourth quarter revenue reached $987.9 million, with adjusted earnings per share at $1.01, surpassing estimates.
  • Fiscal year 2024 revenue was $4.03 billion, and adjusted earnings per share was $4.08.
  • The company experienced a 9% growth in its Molecular Diagnostics segment.
  • Hologic announced a new accelerated share repurchase program valued at $250 million.
  • Revenue from the scalable segment declined by 54.9% in the fourth quarter due to a temporary shipping slowdown, which is expected to recover in Q1 2025.
  • Forecasts for fiscal year 2025 indicate revenue between $1.025 billion and $1.035 billion, with total year revenue between $4.15 billion and $4.20 billion.
  • Earnings per share are expected to range between $4.25 and $4.35.
  • The company anticipates approximately 4% organic growth for 2025.

Company Outlook: Hologic aims to secure future growth through a strong product portfolio and M&A strategy, focusing particularly on untapped international markets. The company expects to sustain growth and enhance its product portfolio in fiscal year 2025.

Negative Points: The scalable business segment experienced a significant decline due to a temporary shipping slowdown. The Breast Health segment is predicted to face slower revenue growth in 2025 before benefiting from a new product launch.

Positive Points: Diagnostic revenues increased by 6.2% in Q4, with Molecular Diagnostics up 9.1%. Breast Health and Surgical revenues grew by 6.2% and 5.4% respectively. The international segment has grown by approximately 50% since 2019, showing significant untapped potential.

Shortcomings: Total revenue for fiscal year 2024 declined slightly by 0.2%, but organic growth excluding COVID showed an increase of 5.3%.

Q&A Highlights: The company discussed its outlook for fiscal year 2025, with an expected midpoint of 4% revenue growth and anticipated margin expansion. International sales are expected to outpace domestic growth. The NovaSure product faces declines in the U.S. market due to competition but is growing internationally. The anticipated acquisition of Gynesonics is expected to complement existing products without causing cannibalization.

Overall, Hologic is positioning itself for continued growth and operational efficiency improvements, particularly focusing on international market opportunities. The company management expressed confidence in strategic direction and the ability to overcome challenges in the upcoming fiscal year.

InvestingPro Forecasts: Hologic's strong performance in Q4 and fiscal year 2024 reflects its current market positioning. According to InvestingPro data, the company has a market capitalization of $19.45 billion, indicating a significant presence in the medical technology sector. This aligns with the reported revenue of $3.99 billion for the last twelve months as of Q3 2024, revealing a strong market footprint.

The company's financial health is further underscored by two key InvestingPro Indicators. First, Hologic operates with a moderate level of debt, supporting its ability to invest in growth initiatives and acquisitions as noted in the earnings report. Second, the company's liquid assets exceed its short-term liabilities, providing financial flexibility to pursue strategic objectives, including the newly announced $250 million accelerated share repurchase program.

Hologic's stock performance has been impressive, delivering a total return of 21.92% last year. This positive trend aligns with the company's optimistic outlook for fiscal year 2025 and focus on international market expansion. The stock is currently trading near its 52-week high, at 98.88% of its peak price, reflecting investor confidence in Hologic's growth strategy and market positioning.

For investors seeking a deeper understanding of Hologic's potential, InvestingPro offers eight additional tips that can provide valuable insights into the company’s financial health and market expectations.