Hologic HOLX stock has been experiencing a declining trend as it navigates an evolving geopolitical and macroeconomic landscape. The shares of the Marlborough, MA-based women’s health company have declined 24.7% over the past six months, significantly below the industry’s 10.7% drop and the S&P 500 composite’s modest 0.3% fall.

Among its industry peers, QIAGEN QGEN has comparatively fared better, while Abbott ABT has shown even more resilience in the same time frame.

Six-Month Price Comparison

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Adding to the slump, the company touched a fresh 52-week low of $60.34 during the March 13 session. Beyond broader economic pressures, challenges and weaknesses within key divisions and a subdued earnings report likely weighed on this performance.

What’s Weighing on Hologic?

Like many others, the company is facing major uncertainties due to the policy shifts under the new U.S. administration. On Jan. 20, President Trump signed an executive order immediately freezing all U.S. foreign assistance to the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR) — Hologic’s main partner for HIV testing in developing countries. Although an “Emergency Humanitarian Waiver” was later issued to ensure continued access to U.S.-funded HIV treatment across the 55 countries, the activities on the ground are said to have been disrupted. On the fiscal 2025 Q1 earnings call, Hologic projected that this could impact revenues by up to $30 million for the rest of the fiscal year.

Additionally, with the recent tariffs implemented, the company could face profitability challenges in importing the Skeletal and Gynesonics products manufactured in Mexico. This adds to the risks of increasing production and storage costs, as worldwide supply-chain constraints and inflationary pressures make it harder to procure key raw materials and components for certain of its products. In the current environment of economically motivated buyers and heightened competition, Hologic’s market position may suffer for not being able to manufacture products on a timely and cost-competitive basis, potentially increasing its average selling prices.

Within its Breast Health unit, the company is preparing for a softer year in gantry placements after its initial gantry market forecast turned out to be overtly aggressive. The segment’s sales in the fiscal first quarter were also disappointing, declining 2.1% on lower sales of capital equipment. Meanwhile, Skeletal revenues dropped 37.4% due to delays in resuming shipments of Horizon DXA units.

The recent strengthening of the U.S. dollar also weighed on first-quarter results, reducing the top line by $9 million. Together, these factors have limited revenue growth to just 0.9% year over year or 1% in constant currency. Hologic now estimates a $30 million FX headwind for the full year, reflecting a $60 million swing from what it had initially guided. Overall, the company’s revised revenue guidance for fiscal 2025 reflects a $100 million reduction, now projecting $4.05 billion to $4.10 billion instead of the prior $4.15 billion-$4.20 billion range.

From a technical standpoint, the stock has been trading below the 50-day simple moving average (SMA) for a while, pointing to a short-term bearish trend.  

Hologic Below 50-Day SMA

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Shifting gears, let’s look at some of the top strengths and opportunities that Hologic is focusing on to drive long-term growth. 

The Success of Recent Acquisitions

Time and again, Hologic has emphasized the importance of strategic acquisitions to expand into high-growth adjacent markets and drive growth. The company’s M&A strategy prioritizes pursuing tuck-in deals that align with its three franchises. Biotheranostics, acquired in 2021, has higher margins than Hologic’s legacy service business and continues to drive accelerated Diagnostics growth through the ongoing adoption of the Breast Cancer Index test.

Within the interventional breast business, Hologic acquired Endomagnetics in 2024, adding wire-free breast surgery localization and lymphatic tracing solutions. The company also sees strong potential to expand the portfolio, leveraging Endomag’s R&D capabilities. In January this year, the company purchased Gynesonics, whose flagship product, the Sonata System, highly complements Hologic’s current Surgical offerings. 

Robust International Opportunity

Hologic is expanding into more regions and enhancing its presence in existing ones. Many of its best-in-class products, such as ThinPrep Pap, and 2D and 3D mammo tests, command a leading share in the domestic market but hold a disproportionately low market share overseas. The company’s international Surgical business is a key growth driver, thanks to Myosure being the only minimally invasive alternative to a complete hysterectomy in many underpenetrated regions.

By bringing in Gynesonics, which generated a healthy mix of international sales in its last fiscal year, Hologic’s international expansion strategy is poised to gain momentum backed by its large Gyn sales force. Overall, the company is well-positioned to capture emerging market opportunities with its cutting-edge offerings and strong brand presence, which are likely to drive accretive growth in the coming years.

Powerful Innovations

The company’s AI-powered breast imaging advancements have sparked significant interest. Hologic will soon introduce the Envision platform, a 3D mammography solution with an industry-leading 2.5-second scan time. The system’s enhanced image quality, patient experience and workflow have already earned positive feedback from the RSNA (Radiological Society of North America) 2024 attendees.

In the United States, Hologic will also introduce Genius AI Detection PRO, an advanced cancer screening technology that expands on the Genius AI Detection 2.0 solution. Furthermore, research confirms that Genius AI Detection 2.0 performs consistently across diverse populations, giving it a competitive edge in tackling significant racial disparities in breast cancer screening and treatment. More recently, the Affirm Contrast Biopsy Software, designed to support radiologists by maximizing workflow efficiencies, received CE Mark.

Hologic’s Valuation Cheap

Shares of Hologic are trading at a forward price-to-earnings (P/E) of 13.96X, much discounted than the industry average of 29.22.  It has a Value Score of B at present.

P/E Forward Twelve Months (F12M)

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Conclusion: Hold HOLX Stock

A mix of macroeconomic headwinds and divisional struggles has impacted Hologic’s recent performance. The company has set a cautious fiscal 2025 outlook amid increasing U.S. policy shifts and potential tariff risks, which are expected to bring operational challenges. Given the mounting uncertainties, those eyeing the stock should wait for a more favorable entry point. On a positive note, Hologic’s recent acquisitions should continue to boost its revenues in the coming quarters, while international opportunities also hold promise to accelerate growth. With its latest innovations drawing strong market interest and the stock still trading at a discount relative to the industry, the current HOLX stockholders may find it prudent to stay invested.

Hologic carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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