Myriad Genetics (NASDAQ:MYGN) stock soared earlier this month after the announcement that UnitedHealth Group will begin covering its GeneSight Psychotropic test beginning in October 2019. But investors hoping for more momentum with Myriad's latest quarterly results were sorely disappointed.
The molecular diagnostics company announced its fourth-quarter results after the market closed on Tuesday. Its stock sank 14% in after-hours trading. Here's what you'll want to know about Myriad's Q4 update.
By the numbers
Myriad Genetics announced fourth-quarter revenue of $215.4 million, an 11% increase from the $193.9 million reported in the same quarter of the previous year. However, this total fell short of the average analysts' revenue estimate of $221 million.
The company reported a Q4 net loss of $4.2 million, or $0.06 per share, based on generally accepted accounting principles (GAAP). Myriad's bottom line reflected significant deterioration from the prior-year-period GAAP net income of $14.5 million, or $0.20 per share.
Myriad reported adjusted net income in the fourth quarter of $0.41 per share. This was lower than its net income of $0.43 per share in the prior-year period. It also came in well below the consensus analysts' adjusted earnings estimate of $0.47 per share.
Behind the numbers
Myriad Genetics CEO Mark Capone acknowledged that the company's revenue was disappointing. He attributed the lower-than-expected figure primarily to lower reimbursement for its expanded carrier screening test.
There were quite a few things to dislike about Myriad's Q4 sales. Revenue for the company's GeneSight genetic test for depression dropped 12% year over year to $29.8 million. Sales for the Vectra rheumatoid arthritis test sank 19% to $12.2 million. Revenue from Myriad's hereditary cancer tests, the company's biggest moneymaker, was flat year over year.
The only bright spots in Myriad's quarter came from its new prenatal screening test launched earlier this year and breast cancer test EndoPredict. Prenatal sales totaled $25 million in the fourth quarter. Sales for EndoPredict climbed 11% year over year to $3 million.
Myriad's bottom-line performance was hurt by higher spending in the fourth quarter. The company reported a 31% year-over-year increase in operating expenses.
Myriad anticipates fiscal first-quarter 2020 revenue will be between $200 million and $202 million. GAAP diluted earnings per share is expected to be between a loss of $0.02 and $0.00, while adjusted diluted earnings per share is projected to be between $0.30 and $0.32.
The company also provided fiscal full-year 2020 guidance. Revenue is expected to fall between $865 million and $875 million. GAAP diluted EPS is anticipated to be between $0.55 and $0.65, and adjusted diluted EPS is projected to be between $1.80 and $1.90.
These ranges fell short of Wall Street expectations. However, Capone remained positive about Myriad's future. He stated that "with stabilized pricing, growing new product volumes, and recent reimbursement advances with GeneSight, we are highly optimistic about our ability to deliver an inflection in revenue and earnings as we transition through the fiscal year."