Omnicell (OMCL) Reports Encouraging 2020 Preliminary Results
Omnicell, Inc. OMCL recently announced preliminary financial results for 2020 as well as provided 2021 guidance.
The company is scheduled to provide its complete fourth-quarter 2020 and full-year 2020 results plus 2021 guidance on Feb 1, 2021.
Following the preliminary result announcement on Jan 13, shares of the company inched up 2.5% to $120.67.
Results in Detail
Per the preliminary release, for 2020, the company anticipates exceeding its pre-pandemic product booking guidance and also expects to surpass its October 2020 view across all key metrics including revenues, total product bookings and non-GAAP earnings per share.
According to the preliminary report, Omnicell projects its 2020 product bookings to be around $1 billion, surpassing its previously-issued guidance of $865-$900 million. The company predicts 2020 total revenues to be $890-$892 million, topping its past guidance of $881-$887 million. The Zacks Consensus Estimate for the same is pegged at $884.2 million.
The company expects its 2020 GAAP net income to be $28.6-$30.6 million and 2020 non-GAAP EBITDA to be $157-$159 million. It also anticipates its 2020 GAAP earnings in the range of 65-70 cents per share and 2020 adjusted earnings to be $2.46-$2.51. The adjusted EPS view exceeds the company’s previous outlook of $2.35-$2.40. The Zacks Consensus Estimate for the metric is pegged at $2.44 per share.
2021 Guidance
Along with the preliminary announcement, the company provided its 2021 expectations. Omnicell projects total revenues between $1.09 billion and $1.11 billion. This indicates an increase from its preliminary guidance issued on Oct 27, 2020.
The company expects 2021 non-GAAP EBITDA within $228-$240 million. It anticipates adjusted earnings between $3.38 and $3.58 per share. The Zacks Consensus Estimate for adjusted EPS is pegged at $3.29.
Highlights
The company achieved significant growth in new customer wins and bookings plus broadened its portfolio of solutions, both organically and through a lucrative acquisition strategy. It also expedited its shift to cloud technology and reaped high revenue gains from its recurring revenues, long-term, sole-source agreements within the top 300 U.S. health systems as well as a strong product backlog.
2025 Goals
The company set a total revenue target of $1.9-$2 billion for 2025, expecting to witness a 14-15% CAGR for the 2021-2025 forecast period. On an organic basis, it is targeting a CAGR of 11-12% for revenues over the same time period with total organic revenues projected to be $1.65-$1.75 billion for 2025.
The company aims to see a CAGR of around 50% for Software-as-a-Service (SaaS), Subscription Software and Technology-Enabled Services revenues from 2020 to 2025. The same is anticipated to account for 20-30% of Omnicell’s top line by 2025.
Omnicell also envisioned a non-GAAP operating margin target of nearly 21% and a non-GAAP EBITDA margin target of almost 25% by 2025. This reflects a non-GAAP EBITDA margin expansion of almost 400 bps from 2021.
Price Performance
In the past three months, the stock has gained 49.5% compared with 17.6% growth of its industry.
Zacks Rank and Other Key Picks
Omnicell currently sports a Zacks Rank #1 (Strong Buy). Some other top-ranked stocks from the broader medical space are Hologic HOLX, PerkinElmer PKI and IDEXX Laboratories IDXX. While Hologic flaunts a Zacks Rank of 1, the other two carry a Zacks Rank #2 (Buy), presently. You can see the complete list of today’s Zacks #1 Rank stocks here.
Hologic has a projected long-term earnings growth rate of 17.4%.
PerkinElmer has a projected long-term earnings growth rate of 19.5%.
IDEXX has an estimated long-term earnings growth rate of 15.8%.
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