Hologic's Underperformance Makes This A Name Worth Further Consideration

Despite some impressive recent quarters, Hologic (NASDAQ:HOLX) shares have underperformed since my last update on this diversified diagnostics and women’s health company. Hologic has benefited from an unexpectedly strong “tail” to COVID-19 testing revenue, but underlying performance has been solid as well, and the company is now in a much stronger position than it was before the pandemic.

Hologic shares are down about 6% since my last update on the company, underperforming the broader medical device space, but not faring too poorly next to names like QIAGEN (NYSE:QGEN), Bio-Rad (NYSE:BIO) or bioMerieux (OTC:BMXXY). If Hologic can hit my target of mid-single-digit long-term revenue growth, double-digit free cash flow growth, and mid-30%’s “post-COVID” EBITDA margins, these shares look undervalued below the low-$80’s.

 

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Hologic's Underperformance Makes This A Name Worth Further Consideration