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Bio-Rad Laboratories (BIO) to Post Q1 Earnings: What Awaits?

Bio-Rad Laboratories, Inc. BIO is expected to release first-quarter 2024 results on May 2 after the closing bell.

The company posted adjusted earnings per share (EPS) of $3.10 in the last reported quarter, beating the Zacks Consensus Estimate by 5.8%. Bio-Rad beat earnings estimates in three of the trailing four quarters and missed the same in one, the average surprise being 1.93%.

Let’s look at how things have shaped up before this announcement

Factors at Play

Life Science

Within the Life Science business, the ongoing weakness in the biopharma end markets is severely impacting sales of Life Science tools and bioprocessing products. This is likely to have impeded the company’s growth in the first quarter. Bio-Rad is also experiencing weaker demand in China as a result of the macroeconomic environment and the local made-in-China initiatives, which are likely to have dented the company’s growth.

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However, the Life Science segment is likely to have witnessed robust demand for the QX600 Droplet Digital PCR platform in the first quarter. Backed by the tremendous customer response, the company earlier took the initiative to ramp up production capacity to accommodate the ongoing demand.

In the fourth quarter, within Life Science Group, academic and government sales for Life Sciences were strong in the Americas, encouraged by several noteworthy announcements involving ddPCR. We believe these to have made a positive contribution to Life Sciences sales in the first quarter of 2024.

Bio-Rad Laboratories, Inc. Price and EPS Surprise

 

Bio-Rad Laboratories, Inc. Price and EPS Surprise
Bio-Rad Laboratories, Inc. Price and EPS Surprise

Bio-Rad Laboratories, Inc. price-eps-surprise | Bio-Rad Laboratories, Inc. Quote

 

Per the last earnings update, Bio-Rad’s process chromatography resins are included in five of the novel therapeutics approved by the FDA. We are also upbeat about the selection of the Bio-Rad QX ONE platform for SMA testing for all newborns in Hong Kong and in the United States. We believe these developments to have boosted the company’s growth in the to-be-reported quarter.

Our model suggests that Bio-Rad’s Life Sciences segment will decline 11.3% to $287.1 million in the quarter to be reported.

Clinical Diagnostics

Excluding COVID-19-related sales, core Clinical Diagnostics sales are expected to have increased in the first quarter from the prior-year period’s levels. The upside is likely to have been driven by strength in diabetes product sales, quality control and blood typing products. During the fourth quarter, management noted that they are thrilled with growth of the Clinical Diagnostics business, especially in Asia-Pacific, where the company prioritized placements to capture some strong growth trends, particularly in the diabetes testing franchise. We believe this trend to have continued through the first quarter as well, thus adding to the top line.

However, like the last few quarters, the continued downturn in COVID-19-related business, the Clinical Diagnostics revenue is expected to show a sharp decline in the first quarter.

Further, the ongoing tightening of sanctions against Russia is making conditions for meeting demand for clinical business increasingly more challenging. This is likely to impede the company’s growth in the to-be-reported quarter.

Our model projects the segment’s revenues for the first quarter to decline 8.2% year over year to $323.2 million.

Earnings Whisper

The Zacks Consensus Estimate for Bio-Rad’s first-quarter 2024 revenues is pegged at $612.2 million, suggesting a fall of 9.6% from the year-ago reported figure.

The Zacks Consensus Estimate for its first-quarter 2024 EPS of $2.04 indicates a year-over-year fall of 38.9%.

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 a higher chance of beating estimates, which is not the case here.

Earnings ESP: Bio-Rad has an Earnings ESP of +0.98%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #4 (Sell).

Stocks Worth a Look

Here are some medical stocks worth considering, as these have the right combination of elements to post an earnings beat this quarter:

High Tide HITI has an Earnings ESP of +175.00% and a Zacks Rank #1. The company is expected to release second-quarter fiscal 2024 results soon. You can see the complete list of today’s Zacks #1 Rank stocks here.

High Tide has an expected earnings growth rate of 100% for fiscal 2024. High Tide surpassed earnings in each of the trailing four quarters, the average being 91.67%.

ShockWave Medical SWAV has an Earnings ESP of +14.51% and a Zacks Rank #3. The company is due to release first-quarter 2024 results on May 13.

SWAV has an expected long-term earnings growth rate of 27.2%. ShockWave Medical surpassed earnings in three of the trailing four quarters and missed in one, the average beat being 13.55%.

Edwards Lifesciences EW currently has an Earnings ESP of +1.68% and a Zacks Rank #2. The company is scheduled to release its first-quarter 2024 results on Apr 25.

EW has a historical long-term earnings growth rate of 9.9%. In the trailing four quarters, Edwards Lifesciences delivered an average earnings surprise of 0.8%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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Edwards Lifesciences Corporation (EW) : Free Stock Analysis Report

Bio-Rad Laboratories, Inc. (BIO) : Free Stock Analysis Report

ShockWave Medical, Inc. (SWAV) : Free Stock Analysis Report

High Tide Inc. (HITI) : Free Stock Analysis Report

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