雅虎香港財經 Why Is Idexx (IDXX) Up 0.9% Since Last Earnings Report?
It has been about a month since the last earnings report for Idexx Laboratories (IDXX). Shares have added about 0.9% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Idexx due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
IDEXX Misses Q2 Earnings Estimates, Narrows '24 Sales View
IDEXX Laboratories, Inc. posted second-quarter 2024 earnings per share of $2.44, down 8.6% year over year. The figure missed the Zacks Consensus Estimate by 14.9%.
Comparable constant-currency earnings per share of $3.02 improved 14.8% year over year.
Revenues in Detail
Quarterly revenues increased 6.4% year over year (up 7% organically) to $1.00 billion. The reported figure was in line with the Zacks Consensus Estimate.
The year-over-year upside was primarily driven by a strong improvement in Companion Animal Group (“CAG”) revenues.
Veterinary software, services and diagnostic imaging systems’ revenues increased 12% on a reported basis and 8% organically, reflecting high recurring revenue growth and continued momentum in cloud-based software placements.
Segmental Analysis
IDEXX derives revenues from four operating segments — CAG, Water, Livestock, Poultry and Dairy (“LPD”), and Other.
CAG revenues rose 6% year over year on a reported basis and 7% on an organic basis to $922.3 million.
CAG Diagnostics’ recurring revenues, too, increased 6% on a reported basis and 7% organically, supported by strong growth in international regions and sustained benefits of IDEXX execution drivers.
The Water segment’s revenues increased 9% year over year on a reported basis and 10% organically to $46.7 million.
For the second quarter, LPD revenues increased 1% on a reported and 3% on an organic basis to $30.3 million.
Revenues from the Other segment rose 5.3% on a reported basis to $4.2 million.
Margins
The gross profit rose 8.1% to $619.2 million. The gross margin expanded 99 basis points (bps) to 61.7% despite a 3.7% rise in the cost of revenues.
Sales and marketing expenses rose 1.5% to $142.7 million. G&A expenses surged 75.4% to $157.2 million. R&D expenses rose 19.2% to $55.5 million. As a result of these, the operating profit in the reported quarter declined 10.9% year over year to $263.8 million. The operating margin in the quarter contracted 510 bps to 26.3%.
Financial Position
IDEXX exited the second quarter with cash and cash equivalents of $401.6 million compared with $397.4 million at the end of the first quarter of 2024. Total debt (including the current portion) was $694.9 million compared with $695.8 million at the end of the first quarter of 2024.
The cumulative net cash provided by operating activities was $446.9 million compared with $384.2 million in the prior-year comparable period.
2024 Guidance
IDEXX provided an updated outlook for 2024.
The company expects total revenues to be in the range of $3,885-$3,945 million (down from the previous guidance of $3,895-$3,965 million). This suggests growth of 6.2-7.8% (earlier 6.5-8.5%) on a reported basis and 6.2-7.8% (earlier 7-9%) on an organic basis. The Zacks Consensus Estimate is currently pegged at $3.93 billion.
IDEXX expects full-year earnings per share to be in the range of $10.31-$10.59 (down from the previous guidance of $10.82-$11.20). This updated guidance indicates reported growth of 2-5% (earlier 8). The Zacks Consensus Estimate for full-year earnings is currently pegged at $11.00 per share.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
VGM Scores
At this time, Idexx has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Idexx has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Idexx belongs to the Zacks Medical - Instruments industry. Another stock from the same industry, Penumbra (PEN), has gained 23.8% over the past month. More than a month has passed since the company reported results for the quarter ended June 2024.
Penumbra reported revenues of $299.4 million in the last reported quarter, representing a year-over-year change of +14.5%. EPS of $0.64 for the same period compares with $0.43 a year ago.
Penumbra is expected to post earnings of $0.71 per share for the current quarter, representing a year-over-year change of +6%. Over the last 30 days, the Zacks Consensus Estimate has changed -0.8%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Penumbra. Also, the stock has a VGM Score of C.
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