Here's Why You Should Invest in Haemonetics (HAE) Right Now

Haemonetics Corporation HAE has gained from consistent growth performance over the past few quarters, reflecting its strategic focus on establishing leading positions in high-growth markets to generate solid financial returns. The company raised the Plasma business outlook for the fiscal 2024, driven by the continued strong plasma market momentum. However, macroeconomic uncertainties and related impacts can affect Haemonetics’ operations.

In the past year, the company’s shares have outperformed its industry. The stock has declined 0.5% compared with the industry’s 3.2% fall and S&P 500’s 15.1% rise.

This renowned global provider of blood management solutions to customers encompassing blood and plasma collectors and hospitals, has a market cap of $4.28 billion. The company has an earnings growth rate of 10% for the next five years.

With solid prospects, this Zacks Rank #2 (Buy) stock is an attractive pick for investors at the moment.

What Makes the Stock an Attractive Pick?

Huge Potential of Hemostasis Management Franchise: Haemonetics’ portfolio of hemostasis diagnostic systems enables clinicians to holistically assess a patient's coagulation status at the point-of-care or laboratory setting.   

In the second quarter of fiscal 2024, business revenues increased 8% owing to the strong utilization of TEG disposables in the United States and benefits from price. The company expects 16% to 18% organic growth in the Hospital business for the full year, with growth in Hemostasis Management consistent with the revenue growth rate delivered in fiscal 2023.

NexSys PCS system Continues to Thrive:  Haemonetics’ NexSys PCS is developed to enable higher plasma yield collections, improve productivity in customers’ centers, enhance the overall donor experience and provide safe and reliable collections that will become life-changing medicines for patients.

There are currently more than 21 million procedures on Persona, which enabled customers to collect 1.5 million liters of additional plasma in just two years, equivalent to the average annual volume from 33 mature plasma centers. Also, the limited market release of the new collection bowl and Express Plus technology is in progress. The launch of these enhancements has garnered great enthusiasm from customers. HAE expects an increase in device inventory throughout the year.

Hospital Business Recovery Continues: Haemonetics’ hospital portfolio is evolving and helping create new opportunities for growth and diversification. In terms of performance in the fiscal second quarter, hospital revenues increased 14%, while Vascular Closure rallied 30%. The upside can be attributed to new account openings, both in electrophysiology and interventional cardiology. The company has been seeing higher utilization rates, backed by its clinical efforts and increased procedure volumes in U.S. hospitals. Internationally, the products are gaining recognition in Germany and Italy, while VASCADE MVP’s commercialization in Japan marked a strong start. Cell Salvage also had a strong quarter, capitalizing on the increased utilization in U.S. hospitals. Transfusion management witnessed continued market share gains in North America and Europe.

Downsides

Economic Uncertainty a Concern: The uncertain economic scenario continues to challenge Haemonetics. The company has been progressing with blood management solutions even though the attempt has been affected by economic challenges. Moreover, a stronger dollar, causing significant currency fluctuations, has been denting the company’s outcome in the past few quarters and no respite is expected in the near term. These factors are a hurdle for Haemonetics in realizing all the benefits of the 2020 Operational Excellence Program.

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Competitive Landscape: Haemonetics operates in a very competitive environment, both for manual and automated systems, comprising companies like MAK Systems, ROTEM analyzers, Medtronic, e Fresenius, MacoPharma and Terumo, among others. Slower-than-expected product adoption by customers, especially the American Red Cross, might reduce revenues and profit.

Estimate Trend

In the past 90 days, the Zacks Consensus Estimate for Haemonetics’ 2024 earnings moved north by 1.8% to $3.89.

The Zacks Consensus Estimate for 2024 revenues is pegged at $1.27 billion, suggesting an 8.7% rise from the year-ago reported number.

Other Key Picks

Some other top-ranked stocks in the broader medical space are DaVita Inc. DVA, Biodesix BDSX and Integer Holdings Corporation ITGR.

DaVita, sporting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 18.3%. DVA’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 36.55%. You can see the complete list of today’s Zacks #1 Rank stocks here.

DaVita’s shares have risen 30.6% year to date compared with the industry’s 1.6% growth.

Biodesix, carrying a Zacks Rank of 2, has an estimated growth rate of 32.3% for 2024. BDSX’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, delivering an average surprise of 9.76%.

Biodesix’s shares have d 36.5% year to date against the industry’s 12.6% decline.

Integer Holdings, sporting a Zacks Rank of 1 at present, has an estimated long-term growth rate of 15.8%. ITGR’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 11.9%.

Integer Holdings’ shares have rallied 30.6% year to date against the industry’s 7.3% decline.

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It’s credited with a “watershed medical breakthrough” and is developing a bustling pipeline of other projects that could make a world of difference for patients suffering from diseases involving the liver, lungs, and blood. This is a timely investment that you can catch while it emerges from its bear market lows.

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Biodesix, Inc. (BDSX) : Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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