It has been about a month since the last earnings report for NuVasive . Shares have lost about 2.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is NuVasive due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
NuVasive Q4 Earnings Miss Estimates, Gross Margin Up
NuVasive delivered fourth-quarter 2021 adjusted earnings per share of 40 cents, registering a 30.5% decline from the year-ago adjusted EPS of 59 cents. The figure also lagged the Zacks Consensus Estimate by 14.9%.
The one-time adjustments include expenses associated with certain business transition costs and amortization expenses, among others.
GAAP loss per share of 71 cents shows a huge decline from the year-ago earnings per share of 3 cents.
For the full year, adjusted earnings were $1.68, reflecting an increase of 36.6% from the year-ago period. However, it lagged the Zacks Consensus Estimate by 4.5%.
Total Revenues
Revenues in the fourth quarter totaled $302.1 million, up 3.5% year over year on a reported basis and up 4.5% at constant exchange rate or CER. The top line beat the Zacks Consensus Estimate by 1.5%.
Fourth-quarter revenues growth was driven by product introductions, particularly the Pulse platform and the C360 portfolio featuring the NuVasive Simplify Cervical Disc in the United States, and continued strong international performance.
Full-year revenues were $1.14 billion, reflecting an 8.4% increase from the year-ago period (up 8.1% at CER). Revenues beat the Zacks Consensus Estimate by 0.9%.
Geographical & Segmental Details
In the reported quarter, U.S. Spinal Hardware business revenues rose 3.4% year over year to $160.5 million.
Revenues from the U.S. Surgical Support business were $69.7 million in the fourth quarter, up 3.4% year over year led by strong sales of the Pulse platform.
In the quarter, the company’s international business delivered a strong performance. Also, NuVasive’s core Spine business grew double digits year over year, led by the Asia Pacific, Europe and Latin America regions.
Margin Details
In the reported quarter, gross profit rose 5.5% year over year to $218.5 million. Gross margin expanded 135 basis points (bps) to 72.4%.
Selling, general and administrative expenses rose 11.4% year over year to $160.7 million, whereas research and development (R&D) expenses climbed 15.9% year over year to $25.2 million.
Overall adjusted operating profit was $32.6 million, down 20.7% from the year-ago figure. Adjusted operating margin saw a 330-bp contraction year over year to 10.8%.
Financial Details
The company exited 2021 with cash and cash equivalents of $246.1 million compared with $856.9 million at the end of 2020.
Cumulative net cash provided by operating activities at the end of 2021 was $182.2 million compared with the prior-year period’s $185.9 million.
2022 Guidance
NuVasive has initiated its financial outlook for full-year 2022.
The company currently expects to report revenue growth in the range of 5-8% (6-9% at CER). The Zacks Consensus Estimate for the revenue is pegged at $1.22 billion.
Adjusted earnings per share are projected in the range of $2.05−$2.35. The Zacks Consensus Estimate for the same is pegged at $2.15. Adjusted operating margin is estimated in the range of 13% to 14.5%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -6.93% due to these changes.
VGM Scores
At this time, NuVasive has an average Growth Score of C, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, NuVasive has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is NuVasive (NUVA) Down 2.2% Since Last Earnings Report?
It has been about a month since the last earnings report for NuVasive . Shares have lost about 2.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is NuVasive due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
NuVasive Q4 Earnings Miss Estimates, Gross Margin Up
NuVasive delivered fourth-quarter 2021 adjusted earnings per share of 40 cents, registering a 30.5% decline from the year-ago adjusted EPS of 59 cents. The figure also lagged the Zacks Consensus Estimate by 14.9%.
The one-time adjustments include expenses associated with certain business transition costs and amortization expenses, among others.
GAAP loss per share of 71 cents shows a huge decline from the year-ago earnings per share of 3 cents.
For the full year, adjusted earnings were $1.68, reflecting an increase of 36.6% from the year-ago period. However, it lagged the Zacks Consensus Estimate by 4.5%.
Total Revenues
Revenues in the fourth quarter totaled $302.1 million, up 3.5% year over year on a reported basis and up 4.5% at constant exchange rate or CER. The top line beat the Zacks Consensus Estimate by 1.5%.
Fourth-quarter revenues growth was driven by product introductions, particularly the Pulse platform and the C360 portfolio featuring the NuVasive Simplify Cervical Disc in the United States, and continued strong international performance.
Full-year revenues were $1.14 billion, reflecting an 8.4% increase from the year-ago period (up 8.1% at CER). Revenues beat the Zacks Consensus Estimate by 0.9%.
Geographical & Segmental Details
In the reported quarter, U.S. Spinal Hardware business revenues rose 3.4% year over year to $160.5 million.
Revenues from the U.S. Surgical Support business were $69.7 million in the fourth quarter, up 3.4% year over year led by strong sales of the Pulse platform.
In the quarter, the company’s international business delivered a strong performance. Also, NuVasive’s core Spine business grew double digits year over year, led by the Asia Pacific, Europe and Latin America regions.
Margin Details
In the reported quarter, gross profit rose 5.5% year over year to $218.5 million. Gross margin expanded 135 basis points (bps) to 72.4%.
Selling, general and administrative expenses rose 11.4% year over year to $160.7 million, whereas research and development (R&D) expenses climbed 15.9% year over year to $25.2 million.
Overall adjusted operating profit was $32.6 million, down 20.7% from the year-ago figure. Adjusted operating margin saw a 330-bp contraction year over year to 10.8%.
Financial Details
The company exited 2021 with cash and cash equivalents of $246.1 million compared with $856.9 million at the end of 2020.
Cumulative net cash provided by operating activities at the end of 2021 was $182.2 million compared with the prior-year period’s $185.9 million.
2022 Guidance
NuVasive has initiated its financial outlook for full-year 2022.
The company currently expects to report revenue growth in the range of 5-8% (6-9% at CER). The Zacks Consensus Estimate for the revenue is pegged at $1.22 billion.
Adjusted earnings per share are projected in the range of $2.05−$2.35. The Zacks Consensus Estimate for the same is pegged at $2.15. Adjusted operating margin is estimated in the range of 13% to 14.5%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -6.93% due to these changes.
VGM Scores
At this time, NuVasive has an average Growth Score of C, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, NuVasive has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.