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St. Jude Medical (STJ) Meets Q2 Earnings, Withdraws Outlook

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St. Jude Medical Inc. reported adjusted earnings of $1.06 per share in the second quarter of 2016, which was in line with the Zacks Consensus Estimate and increased almost 3% on a year-over-year basis. At constant currency (cc), earnings increased 7% from the year-ago quarter to $1.10.

St. Jude is set to be acquired by Abbott Laboratories (ABT - Free Report) . St. Jude shareholders will receive $46.75 in cash and 0.8708 shares of Abbott common stock. Due to the planned merger, St. Jude withdrew its financial guidance for fiscal 2016.

Revenue Details

Total sales improved 11% to $1.56 billion, which beat the Zacks Consensus Estimate of $1.55 billion. On a comparable basis (including Thoratec’s result for both the periods) and adjusting for foreign currency, sales increased 2% on a year-over-year basis.

International sales increased 11% at cc to $767 million, while U.S. sales grew 12% to $795 million.
 

Atrial Fibrillation (AF) sales increased 13% year over year at cc to $324 million, driven by strong adoption of FlexAbility and TactiCath ablation catheters. International sales were up 13% to $189 million, while U.S. sales increased 13% to $135 million in the quarter.

Heart Failure (HF) comprises cardiac resynchronization therapy products, ventricular assist devices and the CardioMEMS HF System products. Sales surged 48% at cc to $384 million, driven by higher sales from ventricular assist devices. On a comparable basis and adjusting for foreign currency, sales decreased 1% on a year-over-year basis.

Neuromodulation sales jumped 20% year over year at cc to $140 million, driven by a 19% surge in U.S. sales and 22% increase in international sales.

Robust performance for St. Jude Medical’s Burst technology in international markets and launch of Axium, Infinity DBS system and directional lead in the Europe drove results.

Cardiovascular sales inched up 2% at cc to $319 million in the quarter. International sales climbed 3% to $198 million, while U.S. sales decreased 1% to $121 million. Sales were propelled by the continued strength of the Portico Transcatheter Aortic Valve Implantation System in Europe. Increasing adoption of OPTIS optical coherence tomography products and PressureWire fractional flow reserve technology also boost sales.

Cardiac Rhythm Management (CRM) sales decreased 7% year over year to $395 million. U.S. sales fell 15% to $186 million while international sales decreased 2% to $209 million in the reported quarter.
 

ST JUDE MEDICAL Price, Consensus and EPS Surprise

ST JUDE MEDICAL Price, Consensus and EPS Surprise | ST JUDE MEDICAL Quote

Zacks Rank & Key Picks

Currently, St. Jude Medical has a Zacks Rank #2 (Buy).

Better-ranked stocks in the same sector are NuVasive and NxStage Medical . Both the stocks sport a Zacks Rank #1 (Strong Buy).

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