Yahoo Finance Here's Why You Should Retain Myriad Genetics (MYGN) Stock Now
Myriad Genetics, Inc. MYGN is well-poised for growth in the coming quarters, backed by robust volume growth across product categories and new strategic partnerships. Strength in the company’s commercial infrastructure resulting from improvements made in the last few years buoys optimism. However, escalating expenses do not bode well for Myriad Genetics.
In the past year, this Zacks Rank #3 (Hold) stock has declined 12.9% compared with the 5.5% fall of the industry and a 5.7% rise of the S&P 500 composite.
The renowned genetic testing and precision medicine company has a market capitalization of $1.52 billion. Myriad Genetics projects estimated earnings growth of 71.9% for the next year, compared with 9.3% of the industry and 19.2% of the S&P 500 composite. MYGN’s earnings surpassed estimates in two of the trailing four quarters and missed the same in the other two, delivering an average negative surprise of 65.13%.
Let’s delve deeper.
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Upsides
Product Volume Growth Contributes: Myriad Genetics attributes the year-over-year increase in first-quarter 2023 revenues to strong growth in product testing volumes.
Within the Oncology business, Hereditary cancer testing volumes reported impressive double-digit growth. MYGN’s leading prostate cancer test Prolaris was another highlight of the first quarter, reporting volume growth of 22% from the prior-year quarter. The company’s Mental Health business witnessed a record number of GeneSight tests in the first quarter, with nearly 4,000 clinicians ordering the test for the first time.
Excluding contributions from the Gateway Genomics acquisition, prenatal testing volumes grew 12% compared to the first quarter of 2022. The quarterly figure includes minimal contributions from California due to ongoing disruptions caused by the state's revised prenatal screening program.
New Partnerships Appear Promising: Myriad Genetics announced several new strategic partnerships in the first quarter of 2023.
In March, the company expanded its partnership with Illumina to increase the access and availability of oncology homologous recombination deficiency testing in the United States.
Last month, Myriad Genetics announced a collaboration with SimonMed Imaging — one of the largest independent outpatient imaging providers in the United States. The program is expected to enable affordable access to genetic testing and deliver personalized insights to better inform clinical decisions for millions of potential patients.
On the first-quarter earnings call, MYGN mentioned that it has entered into a partnership with ClinVar at the request of the company’s providers.
Strength in Commercial Capabilities: Throughout last year, Myriad Genetics made good progress in its commercial execution, resulting in robust volume growth in the last two quarters. The company credits its skilled and experienced sales force as the key drivers of commercial performance.
MYGN enhanced its Oncology commercial team by adding experienced leadership, which provided improved operational efficiencies. These include a significant reduction in turnaround times for oncology tests compared to the previous year’s quarter, a Net Promoter Score of 73% amongst oncology providers and a fully equipped sales force. Per MYGN, continued commercial execution and top-tier talent will fuel its long-term growth even further.
Downside
Mounting Expenses Put Pressure: Myriad Genetics reported a contraction in the gross margin and an operating loss in the first quarter of 2023. The quarter’s adjusted operating expenses reflected investments in sales and marketing programs, technology, research and development, additional operating expenses from Gateway Genomics and inflationary pressures.
Estimate Trend
Myriad Genetics has been witnessing a positive estimate revision trend for 2023. In the past 30 days, the Zacks Consensus Estimate for 2023 loss per share has narrowed from 34 cents to 32 cents.
The Zacks Consensus Estimate for the company’s 2023 revenues is pegged at $740.8 million, suggesting a 9.2% rise from the year-ago reported number.
Key Picks
Some better-ranked stocks in the broader medical space are Zimmer Biomet ZBH, Penumbra PEN and Hologic, Inc. HOLX.
Zimmer Biomet, sporting a Zacks Rank #1 (Strong Buy) at present, has an earnings yield of 5.42% compared to the industry’s -1.86%. Zimmer Biomet’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 7.38%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Zimmer Biomet shares have increased 14.6% compared to the industry’s 29.6% decline in the past year.
Penumbra, sporting a Zacks Rank #1 at present, has an estimated growth rate of 64.1% for 2024. Penumbra shares have risen 60.4% against the industry’s 29.6% fall over the past year.
PEN’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 109.4%.
Hologic, carrying a Zacks Rank #2 (Buy) at present, has an earnings yield of 4.68% compared to the industry’s -7.62%. Shares of HOLX have risen 4.2% compared with the industry’s 2.1% growth over the past year.
Hologic’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 27.3%.
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Hologic, Inc. (HOLX) : Free Stock Analysis Report
Myriad Genetics, Inc. (MYGN) : Free Stock Analysis Report
Zimmer Biomet Holdings, Inc. (ZBH) : Free Stock Analysis Report
Penumbra, Inc. (PEN) : Free Stock Analysis Report
