Genetic testing company Myriad Genetics (NASDAQ:MYGN) reported revenue ahead of Wall Street’s expectations in Q2 CY2025, but sales were flat year on year at $213.1 million. The company’s full-year revenue guidance of $823 million at the midpoint came in 1.5% above analysts’ estimates. Its non-GAAP profit of $0.05 per share was significantly above analysts’ consensus estimates.
Revenue: $213.1 million vs analyst estimates of $202 million (flat year on year, 5.5% beat)
Adjusted EPS: $0.05 vs analyst estimates of -$0.01 (significant beat)
Adjusted EBITDA: $14.5 million vs analyst estimates of $4.75 million (6.8% margin, significant beat)
The company slightly lifted its revenue guidance for the full year to $823 million at the midpoint from $815 million
EBITDA guidance for the full year is $30 million at the midpoint, above analyst estimates of $20.53 million
Operating Margin: -154%, down from -17.3% in the same quarter last year
Free Cash Flow was -$20.5 million compared to -$2.6 million in the same quarter last year
Market Capitalization: $366.9 million
“We delivered solid second-quarter results, driven by continued strength in hereditary cancer testing in oncology, improving momentum in hereditary cancer testing for unaffected individuals, and favorable pricing trends supported by mix and our ongoing efforts to expand payer coverage. Our disciplined approach to expense management contributed to our improved profitability while we continued to invest in strategic drivers to enable long-term growth,” said Sam Raha, President and CEO, of Myriad Genetics.
Founded in 1991 as one of the pioneers in translating genetic discoveries into clinical applications, Myriad Genetics (NASDAQ:MYGN) develops genetic tests that assess disease risk, guide treatment decisions, and provide insights across oncology, women’s health, and mental health.
A company’s long-term sales performance can indicate its overall quality. Any business can have short-term success, but a top-tier one grows for years. Over the last five years, Myriad Genetics grew its sales at a mediocre 5.5% compounded annual growth rate. This was below our standard for the healthcare sector and is a poor baseline for our analysis.
Myriad Genetics Quarterly Revenue
We at StockStory place the most emphasis on long-term growth, but within healthcare, a half-decade historical view may miss recent innovations or disruptive industry trends. Myriad Genetics’s annualized revenue growth of 9.2% over the last two years is above its five-year trend, suggesting some bright spots.
Myriad Genetics Year-On-Year Revenue Growth
This quarter, Myriad Genetics’s $213.1 million of revenue was flat year on year but beat Wall Street’s estimates by 5.5%.
Looking ahead, sell-side analysts expect revenue to remain flat over the next 12 months, a deceleration versus the last two years. This projection doesn’t excite us and indicates its products and services will see some demand headwinds.
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Although Myriad Genetics was profitable this quarter from an operational perspective, it’s generally struggled over a longer time period. Its expensive cost structure has contributed to an average adjusted operating margin of negative 1.3% over the last five years. Unprofitable healthcare companies require extra attention because they could get caught swimming naked when the tide goes out. It’s hard to trust that the business can endure a full cycle.
On the plus side, Myriad Genetics’s adjusted operating margin rose by 4.2 percentage points over the last five years, as its sales growth gave it operating leverage. This performance was mostly driven by its recent improvements as the company’s margin has increased by 11.2 percentage points on a two-year basis.
In Q2, Myriad Genetics generated an adjusted operating margin profit margin of 4%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.
Myriad Genetics’s full-year EPS flipped from negative to positive over the last five years. This is encouraging and shows it’s at a critical moment in its life.
Myriad Genetics Trailing 12-Month EPS (Non-GAAP)
In Q2, Myriad Genetics reported adjusted EPS at $0.05, in line with the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Myriad Genetics to perform poorly. Analysts forecast its full-year EPS of $0.11 will hit $0.09.
This was a beat and raise quarter. We were impressed by how significantly Myriad Genetics blew past analysts’ revenue, EBITDA, and EPS expectations this quarter. We were also excited its full-year revenue guidance was raised and full-year adjusted EBITDA guidance was ahead of expectations. Zooming out, we think this quarter featured some very important positives. The stock traded up 30.6% to $5.04 immediately after reporting.
Myriad Genetics put up rock-solid earnings, but one quarter doesn’t necessarily make the stock a buy. Let’s see if this is a good investment. We think that the latest quarter is just one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free.
