Hologic to Purchase Mobidiag for $795 Million; Morgan Stanley Says Acquisition Makes Sense

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Hologic, a worldwide chief in girls’s well being, mentioned on Thursday that it’s going to purchase the fast-growing Finnish French biotechnology firm Mobidiag Oy for about $795 million, together with a money fee of practically $714 million for Mobidiag’s fairness, and web debt of about $81 million.

The acquisition is predicted to shut early within the fourth quarter of fiscal 2021.

In 20202, Mobidiag generated practically $42 million of income. Hologic anticipated to spend money on assay growth to drive the expansion of the Novodiag platform. In consequence, the acquisition is predicted to be about $0.10 dilutive to Hologic’s non-GAAP earnings per share in fiscal 2022, barely dilutive in 2023, and accretive thereafter, the corporate mentioned within the press launch.

Hologic’s shares, which surged about 40% in 2020, rose simply over 1% to $73.58 thus far this 12 months.

Analyst Feedback

“Mobidiag was not cheap, however the asset affords an entry level into the quickly rising acute-care phase and may be very in step with Hologic’s technique to increase MDx all through and past the COVID-19 pandemic,” famous David Lewis, fairness analyst at Morgan Stanley.

Hologic has developed two molecular diagnostic exams for COVID-19 that are driving important monetary contribution. The corporate’s 3-4% end-market development charges possible restrict long-term development potential to an extent, however COVID-19 Dx money stream may enable materials reinvestment or tuck-ins to shift underlying development greater. We see elevated M&A exercise as a requirement to shift the WAGMR greater and drive the a number of.”

Hologic Inventory Worth Forecast

Seven analysts who provided inventory rankings for Hologic within the final three months forecast the typical value in 12 months of $96.00 with a excessive forecast of $110.00 and a low forecast of $91.00.

The typical value goal represents a 30.47% improve from the final value of $73.58. Of these seven analysts, six rated “Purchase”, one rated “Maintain” whereas none rated “Promote”, in keeping with Tipranks.

Morgan Stanley gave the bottom goal value of $84 with a excessive of $96 underneath a bull situation and $56 underneath the worst-case situation. The agency gave an “Equal-weight” ranking on the medical know-how firm’s inventory.

A number of different analysts have additionally up to date their inventory outlook. Hologic had its goal value boosted by Jefferies to $110 from $106. Jefferies Monetary Group at present has a purchase ranking. Robert W. Baird upped their value goal to $91 from $84 and gave the inventory a purchase ranking.

Furthermore, Zacks Funding Analysis downgraded Hologic to a maintain ranking from a purchase and set a $79 value goal on the inventory. Argus upped their value goal to $100 from $85.

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