On Aug 19, we have updated our research report on
). We are impressed with the company's strength in maintaining its
earnings momentum after a period of continued losses. The company's
restructuring plan to focus on high growth markets is finally
paying off as demonstrated by its bottom line growth in every
Affymetrix posted a robust 75% rise in adjusted earnings per share
to 7 cents for the second quarter of 2014 from 4 cents in the same
quarter a year ago and surpassed the Zacks Consensus Estimate of 3
Revenues in the quarter spiked 7.5% to $85.4 million and edged past
the Zacks Consensus Estimate of $83 million. The upside was driven
by strength in the company's Genetic Analysis business unit
(accounting for nearly 40% of the company's revenues).
At the beginning of 2013, Affymetrix implemented a corporate
restructuring plan, which will continue till 2016, intending to
accelerate toward profitability. The plan focuses on realigning its
product portfolio, stabilizing its core business, positioning the
company for growth and increasing its profitability in an effort to
offset a downswing in its underlying business.
Affymetrix upgraded its previously announced revenue and EBITDA
guidance for 2014. The company expects to generate revenues of $340
million, in line with the current Zacks Consensus Estimate. The
company also projects EBITDA margin in the range of 14 to 15%.
Currently, Affymetrix carries a Zacks Rank #2 (Buy). Other stocks
that are also worth a look from the biomed/gene industry include
Cambrex Corporation (
), China Biologic Products, Inc. (
), and Epizyme, Inc. (
). All of them carry a Zacks Rank #1 (Strong Buy).
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