Haemonetics: Profits from Plasma

08/12/2019 5:00 am EST


Leo Fasciocco

Investment Columnist and Publisher, Ticker Tape Digest

Haemonetics (HAE) provides plasma collection systems and software, which enable plasma fractionators to make pharmaceuticals, notes Leo Fasciocco, breakout stock specialist and editor of Ticker Tape Digest.

The company enables plasma collection customers to source from it a range of products necessary for plasma collection and storage.

It also includes PCS brand plasma collection equipment and disposables, plasma collection containers and intravenous solutions, such as saline. The firm also has a suite of integrated software that includes solutions for blood drive planning and blood collection. Annual revenues are $968 million.

Technically, the stock's recent move higher was triggered by better than expected earnings for the fiscal first quarter ended in June. The company came in with net of 81 cents a share. That topped the consensus estimate of 64 cents a share.

Net for the upcoming fiscal second quarter ending in September is predicted to rise 23% to 69 cents a share from the 56 cents the year before.  

Analysts are forecasting a 23% increase in net for the fiscal year ending in March of 2020 to $2.93 a share from the $2.39 the year before.  The stock sells with a price-earnings ratio of 44. That is high given the earnings growth rate.

Looking out to fiscal 2021 ending in March analysts expect a 23% rise in net to $3.61 a share from the anticipated $2.93 the current fiscal year.

The breakout is strong coming with a widening of the daily spread and an expansion in volume. The stock's momentum indicator is strongly bullish. We see more on the upside. We are targeting a move to $160 within the next few months.  A protective stop can be placed near $124.

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