Yahoo Finance Veracyte (VCYT) Up 8.4% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Veracyte (VCYT). Shares have added about 8.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Veracyte due for a pullback? 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.
Veracyte's Q1 Loss Lower Than Expected, '24 Sales View Up
Veracyte delivered a diluted loss of 2 cents per share in the first quarter of 2024 compared with a loss of 11 cents per share in the year-ago period. The reported figure is also narrower than the Zacks Consensus Estimate of a loss of 19 cents per share.
Revenues
Revenues reported in the first quarter increased 17.5% year over year to $96.8 million. The metric exceeded the Zacks Consensus Estimate by 3.3%.
Quarterly Details
Testing revenues were $90.3 million in the reported quarter, up 24.7% year over year. This rise was mainly due to Decipher and Affirma volumes, along with ASP (Average Selling Price) growth, driven by payer contracting and prior period collection.
Product revenues fell 9.1% year over year to $3.5 million.
Biopharmaceutical and other revenues of $3.0 million reflected a 51% decrease compared to last year’s figure. This was mainly affected by the overall spending constraints across the industry.
Margins
The total cost of revenues (product, testing, biopharmaceutical and other) during the reported quarter was $31.5 million, up 20% year over year.
The gross profit rose 16.4% to $65.4 million. The gross margin contracted 66 basis points (bps) to 67.5% in the first quarter.
Selling and marketing expenses fell 9% to 23.8 million, while general and administrative expenses increased 24.5% to $26 million. R&D expenses totaled $16 million, up 25% year over year. The company delivered an operating loss of $0.57 million in the first quarter compared to an operating loss of $3.8 million during last year’s comparable period.
Cash, Capital Structure and Solvency
Veracyte exited the first quarter with cash and cash equivalents of $209.2 million compared with $216.5 million at the end of 2023. The cumulative net cash outflow from operating activities at the first quarter-end was $9 million compared with cash outflow of $2.2 million at the end of the first quarter of 2023.
Guidance
Vertacyte provided a revised financial outlook for 2024. Revenues for 2024 are expected between $402 million and $410 million (earlier $394 million and $402 million). The Zacks Consensus Estimate presently stands at $399.1 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates flatlined during the past month.
The consensus estimate has shifted 14.29% due to these changes.
VGM Scores
At this time, Veracyte has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, 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 D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Veracyte has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Veracyte belongs to the Zacks Medical - Instruments industry. Another stock from the same industry, Inari Medical, Inc. (NARI), has gained 20.4% over the past month. More than a month has passed since the company reported results for the quarter ended March 2024.
Inari Medical reported revenues of $143.19 million in the last reported quarter, representing a year-over-year change of +23.3%. EPS of -$0.26 for the same period compares with -$0.04 a year ago.
For the current quarter, Inari Medical is expected to post a loss of $0.20 per share, indicating a change of -600% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
Inari Medical 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.
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Veracyte, Inc. (VCYT) : Free Stock Analysis Report
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