Photo by National Cancer Institute on Unsplash

Meridian Bioscience (VIVO) is a $1 billion provider of diagnostic test kits for gastrointestinal and respiratory infectious diseases.

In addition, the company develops and manufactures a variety of biological and non-biological materials used in proficiency testing programs. Meridian diagnostic products are used outside of the human body and require little or no special equipment.

VIVO became a Zacks #1 Rank Strong Buy after its last earnings report which prompted Wall Street analysts to raise this year's EPS consensus 17% from $1.04 to $1.22.

On February 4, Meridian delivered a beat-and-raise Q1 for FY'22 (ends Sep) that sent shares up 26% over the next 3 sessions.

Meridian reported Q1 EPS of 35-cents vs the consensus of 25-cents and Q1 revenue of $88.3 million vs the consensus of approximately $73.5M.

Jack Kenny, CEO, commented, "While disappointed that we are fighting yet another wave of COVID-19 infections across the globe, I am pleased to report that Meridian delivered an outstanding quarter. Continued strength in our Life Science segment, coupled with growing momentum in the Diagnostics segment, is a sign of the company's potential in fiscal 2022 and beyond."

Guidance Boost

Meridian Bioscience raised their FY22 adjusted EPS view to $1.10-$1.30 from 98c-$1.07.

And they raised FY22 their revenue view to $315.0M-$330.0M, from $285M-$300M.

Management projects FY22 Diagnostics segment revenue of $145.0M-$150.0M and Life Science revenue of $170.0M-$180.0M.

The company said, "The performance of both segments in the first quarter exceeded our expectations. Based on these results and current demand for Life Science segment reagents, we are raising our guidance for the full fiscal year."

Analyst Reaction

Here were two positive analyst reactions to the turn-around in top and bottom-line growth...

Meridian Bioscience price target raised to $30 from $28 at H.C. Wainwright: Analyst Yi Chen raised the firm's price target and reiterated a Buy rating on the shares following the "robust" fiscal Q1 beat. The analyst says H. pylori testing may provide "significant growth" for Meridian's diagnostics segment.

William Blair analyst Brian Weinstein noted that the quarter included particularly difficult comps across the business given the company’s all-time record first quarter of 2021 with $92.9 million in sales...

"Overall, we view this update as an indication of sound execution across both business segments as the company continues to take advantage of the life sciences revenue
opportunities presented by the pandemic while making behind-the-scenes progress to bring back growth in the diagnostics segment."

The Blair team maintains an Outperform rating on VIVO shares.