How Hologic's Focus on Women's Health Could Fend Off General Electric and Siemens

Hologic (NASDAQ: HOLX  ) will release its quarterly report on Monday, and investors expect flat earnings compared to the year-ago quarter on a slight gain in revenue. Yet in the long run, Hologic hopes that its specialization in creating diagnostic products and medical imaging systems aimed at important women's health issues will give it a competitive edge over larger rivals General Electric (NYSE: GE  ) and Siemens (NASDAQOTH: SIEGY  ) , both of which have large health-care segments of their own.

Hologic has become an important player in the women's health field, with medical devices that include mammography imaging systems, screening tests, and equipment that measures bone density to assess the onset of osteoporosis. But General Electric has a long history of building its own imaging equipment that competes with Hologic in covering similar conditions, and Siemens also makes products aimed at addressing women's health issues. Let's take an early look at what's been happening with Hologic over the past quarter and what we're likely to see in its report.

Stats on Hologic

Analyst EPS Estimate

$0.37

Change From Year-Ago EPS

0%

Revenue Estimate

$624.42 million

Change From Year-Ago Revenue

4%

Earnings Beats in Past 4 Quarters

3

Source: Yahoo! Finance.

Can Hologic earnings start growing again?
Analysts have been a bit more pessimistic about Hologic earnings in recent months, trimming September-quarter estimates by a penny per share and full-year fiscal projections by $0.03 per share. The stock has also eased lower, losing 2% since early August.

Arguably the biggest news for Hologic came early in the quarter in July, when the company brought back former CEO Jack Cumming to take over as Hologic's new CEO after the resignation of Robert Cascella. Cumming served as CEO from 2001 to 2009, and investors cheered the move. The fact that the company pre-announced favorable earnings results for its June quarter also helped give investors more confidence in Hologic's shares.

Hologic has kept making progress with key diagnostic tests, as the Food and Drug Administration approved the company's Aptima HPV assay for Hologic to use with its automated Panther system in July, and then followed up  earlier this week with a specific Aptmia variant to detect HPV types 16, 18, and 45. The Aptima tests detect more than dozen strains of human papillomavirus, which has been linked to cervical cancer and precancerous lesions in women. With heightened awareness of HPV in recent years, Aptima represents a large potential growth avenue for Hologic.

Yet many investors aren't convinced that Hologic can tap the full potential of its products, especially with giants like General Electric and Siemens looming over the small company. Analyst expectations for sluggish growth in Aptima sales as well as its NovaSure endometrial ablation equipment and its bone imaging equipment hurt Hologic's share price in September, even as digital mammography technology in its Selenia system could be a big driver of long-term growth. General Electric came out last year with an ultrasound breast-cancer screening device that gave GE both screening and diagnosis tools using ultrasound, and Siemens has also developed devices designed to provide more information on women's health issues.

In the Hologic earnings release, watch to see how the company's various segments perform. Hologic has plenty of promise in the many areas of women's health it serves, and even with General Electric and Siemens as rivals, Hologic could start to ramp up its growth if it can get more exposure for its products.

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