Yahoo Finance Why Is Exact Sciences (EXAS) Down 17.5% Since Last Earnings Report?
A month has gone by since the last earnings report for Exact Sciences (EXAS). Shares have lost about 17.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Exact Sciences due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Exact Sciences Q1 Revenues Rise Y/Y, Gross Margin Down
Exact Sciences reported a net loss of 50 cents per share in first-quarter 2024, in line with the Zacks Consensus Estimate. This quarter's loss was wider than the year-ago loss of 42 cents.
Revenues in Detail
First-quarter consolidated revenues were $637.5 million, up 5.8% on reported and core revenue basis year over year. The metric exceeded the Zacks Consensus Estimate by 2%.
Segments in Detail
Screening revenues, including laboratory service revenues from Cologuard, PreventionGenetics and immaterial revenues from Biomatrica products, were $4748 million. The figure increased 7% year over year. The upside can be primarily attributed to broad-based momentum in Cologuard adoption by healthcare providers.
Precision Oncology revenues, including laboratory service revenues from global Oncotype products and therapy selection products, were $163 million, up 5% year over year and 4% on a core basis. The upside was propelled by Oncotype DX, which expanded 7% globally.
The company did not recognize any revenues from COVID-19 testing in the first quarter.
Margins
In the quarter under review, Exact Sciences’ gross profit (excluding the amortization of acquired intangibles) rose 4.9% to $467.4 million. The gross margin contracted 64 basis points (bps) to 73.3%.
Research and development expenses rose 15.9% year over year to $110.6 million. Sales and marketing expenses moved up 2.9% to $192.4 million.
General and administrative expenses rose 11.9% year over year to $243.1 million.
Adjusted operating expenses were $546.1 million in the first quarter, up 9.2% year over year. Adjusted operating loss totaled $78.7 million, wider than the year-ago operating loss of $54.1 million.
Financial Update
Exact Sciences exited the first quarter of 2024 with cash and cash equivalents and marketable securities of $652.1 million compared with $777.6 million at the end of fourth-quarter 2023.
The company had no long-term debt on its balance sheet at the end of first-quarter 2024.
2024 View
The company maintained its 2024 revenue guidance.
Exact Sciences expects total revenues for the full year to be in the range of $2.81-$2.85 billion. The Zacks Consensus Estimate for the same is pegged at $2.83 billion.
The company expects Screening revenues in the range of $2.16-$2.18 billion.
The company expects Precision Oncology revenues in the range of $655-$675 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -44.09% due to these changes.
VGM Scores
Currently, Exact Sciences has a poor Growth Score of F, a grade with the same score on the momentum front. Charting a somewhat similar path, 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 F. 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 Exact Sciences 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
Exact Sciences belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Geron (GERN), has gained 0.3% over the past month. More than a month has passed since the company reported results for the quarter ended March 2024.
Geron reported revenues of $0.3 million in the last reported quarter, representing a year-over-year change of +1400%. EPS of -$0.09 for the same period compares with -$0.07 a year ago.
Geron is expected to post a loss of $0.11 per share for the current quarter, representing a year-over-year change of -22.2%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
Geron has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Exact Sciences Corporation (EXAS) : Free Stock Analysis Report
Geron Corporation (GERN) : Free Stock Analysis Report
