Quidel Corporation QDEL is scheduled to report first-quarter 2022 results on May 4, after the closing bell.
In the last-reported quarter, the company's earnings of $7.29 per share surpassed the Zacks Consensus Estimate by 49.1%. Over the trailing four quarters, its earnings outperformed the Zacks Consensus Estimate on two occasions and missed the same in the other two, delivering an earnings surprise of 129.4%, on average.
Let's see how things have shaped up for Quidel prior to this announcement:
Factors at Play
Quidel's first-quarter 2022 revenues are likely to have been driven by its COVID-19 business, where the company expects to have continued witnessing strong testing demand. During its fourth-quarter 2021 earnings call, Quidel had confirmed that over the past few months before the results, strong demand for COVID-19 rapid immunoassay products for both Sofia SARS antigen tests and QuickVue At-Home OTC (over-the-counter) COVID-19 tests had been recorded.
Quidel also confirmed entering into strategic partnerships with major retail players like CVS Health Corporation and Walgreens to further expand into the retail and online entry points for the consumer at-home testing market. Given that the demand for COVID-19 testing remains strong, the Sofia and QuickVue tests are likely to have continued their strong momentum, thereby significantly driving first-quarter revenues.
Quidel's Savanna MDx instrumented system, launched in select ex-U.S. markets during the last-reported quarter, is expected to have witnessed strong customer adoption. This is another factor which is likely to drive the to-be-reported quarter's top-line.
In fact, per the preliminary announcement, revenues for first-quarter 2022 are estimated to be $990-$1,000 million on a reported basis, reflecting a surge of 164-166% from the year-ago period.
During the fourth-quarter earnings call, Quidel had confirmed that there was a demand in emerging markets, which could be captured via both telehealth technology and digital health capabilities, thereby expanding patient access to a wide range of point-of-care and OTC diagnostic products. In this space, the company offers both Sofia Q as well as an innovative self-test mobile application — QVue business — to help address enterprise and employee health use cases. Apart from this, a consumer version of the app is in development. These products are likely to have witnessed robust customer adoption in the to-be-reported quarter, thereby contributing to revenue growth.
Per the preliminary announcement, the company's COVID-19 revenues for the quarter are expected to be around $836 million. Quidel also confirmed selling around 113 million QuickVue COVID-19 antigen tests and around 12 million Sofia SARS antigen tests during the first quarter.
Per the same announcement, Quidel has been observing a robust adoption of its products over the past few months, which has driven up shipments of its SARS tests. The company, which has been registering strong demand for its QuickVue At-Home OTC COVID-19 test, has been ramping up its production to meet the surge in demand. Quidel has also been seeing a solid uptick in demand for its QuickVue COVID-19 antigen tests and Sofia SARS antigen tests, which is expected to lead to solid quarterly sales volume for tests in the to-be-reported quarter.
Quidel's highly-automated QuickVue manufacturing facility in Carlsbad, CA is also likely to have driven the company's top line in the first quarter.
The company's preliminary projection of a robust improvement in revenues on the back of solid testing volumes lifts our confidence in the stock.
The Estimate Picture
For first-quarter 2022, the Zacks Consensus Estimate for total revenues is currently pegged at $823 million.
The consensus estimate for earnings per share is pegged at $9.28, implying a surge of 111.9% from the prior-year period's reported number.
What Our Model Suggests
Per our proven model, a stock with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), along with a positive Earnings ESP, has higher chances of beating estimates. However, this is not the case here as you can see:
Earnings ESP: Quidel has an Earnings ESP of -14.52%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #3.
Stocks Worth a Look
Here are a few medical stocks worth considering, as these have the right combination of elements to beat on earnings this reporting cycle:
Meridian Bioscience, Inc. VIVO has an Earnings ESP of +26.32% and a Zacks Rank of 2. Meridian Bioscience has an earnings yield of 5.2% compared with the industry's 0.9%.
Meridian Bioscience's earnings surpassed estimates in three of the trailing four quarters, with the average surprise being 9.3%. You can see the complete list of today's Zacks #1 Rank stocks here.
Qiagen N.V. QGEN has an Earnings ESP of +0.14% and is a Zacks #2 Ranked stock. Qiagen has an estimated long-term growth rate of 11.5%.
Qiagen's earnings surpassed estimates in the trailing four quarters, the average surprise being 9.8%.
Vertex Pharmaceuticals Incorporated VRTX has an Earnings ESP of +0.87% and is a Zacks #2 Ranked stock. Vertex Pharmaceuticals has an estimated long-term growth rate of 11.5%.
Vertex Pharmaceuticals' earnings surpassed estimates in the trailing four quarters, the average surprise being 10%.
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