Mizuho Securities analyst Anthony Petrone maintained a Buy rating on Hologic (HOLX – Research Report) on February 2 and set a price target of $85.00.
Anthony Petrone’s Buy rating for Hologic is grounded in a robust fiscal first-quarter performance and favorable prospects for the company’s growth and margins. Hologic’s Breast Health and Molecular Diagnostics segments outperformed expectations, with the latter benefiting from an expanded menu on post-COVID PANTHER placements. Despite facing year-over-year challenges in the early quarters of FY2024, the company anticipates each segment to achieve a 5-7% full-year growth. Additionally, the updated guidance for FY2024 suggests a healthy top-line organic growth excluding COVID impacts, which aligns with Hologic’s long-range plans, and projected margin improvements as the company overcomes semiconductor supply issues.
Moreover, the FDA approval of Hologic’s Genius Digital cervical diagnostic system is expected to contribute to growth upon its launch later in the year. The company also boasts a strong Breast Health gantry backlog and is poised for continued market share gains with its PANTHER platform diagnostics. Petrone emphasizes that Hologic’s operational margins are set to improve from 28.5% to around 31% by the end of FY2024, bolstered by resolving chip supply headwinds and reduced expenses. With these factors in mind, coupled with a positive early investor reaction and the potential for re-rating in the stock’s valuation, Petrone maintains a Buy recommendation, signaling confidence in Hologic’s financial trajectory.
In another report released on February 2, Needham also reiterated a Buy rating on the stock with a $90.00 price target.
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Hologic (HOLX) Company Description:
Hologic, Inc. engages in the development, manufacture, and supply of diagnostics products, medical imaging systems, and surgical products dedicated to serve the healthcare needs of women. It operates through the following business segments: Breast Health, Diagnostics, Medical Aesthetics, GYN Surgical, and Skeletal Health. The Breast Health segment includes a broad portfolio of breast imaging and related products and accessories, including digital mammography systems, computer-aided detection, for mammography and minimally invasive breast biopsy devices, breast biopsy site markers, and breast biopsy guidance systems. The Diagnostics segment comprises Aptima family of Assays, target capture/nucleic acid extraction techonolgy, transcription-mediated amplification technology, hybridization protection assay and dual kinetic assat technologies, instrumentation, and Invader Chemistry Platform. The Medical Aesthetics segment offers SculpSure; PicoSure, MedLite, and RevLite; and MonaLisa Touch. The GYN Surgical segment encompasses the NovaSure Endometrial Ablation System and the MyoSure Hysteroscopic Tissue Removal System. The Skeletal Health segment covers the discovery and horizon X-ray bone densitometry system, an ultrasound-based osteoporosis assessment product, and Fluoroscan mini C-arm imaging products. The company was founded by S. David Ellenbogen and Jay A. Stein in 1986 and is headquartered in Marlborough, MA.
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