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Wright Medical (WMGI) Posts Wider-than-Expected Loss in Q1
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Wright Medical Group N.V. reported adjusted loss of 9 cents per share in the first quarter of 2017, wider than the Zacks Consensus Estimate of a loss of 8 cents.
However, loss narrowed by 3 cents on a year-over-year basis.
Net sales in the first quarter totaled $177 million which was below the consensus mark of $182 million.
Meanwhile, in three of the last four quarters, the company posted positive earnings surprises, the average being 20.4%. Currently, the stock has a Zacks Rank #4 (Sell).
Wright Medical Group N.V. Price, Consensus and EPS Surprise
Wright Medical launched PERFORM Reversed Glenoid Shoulder System in the quarter, a significant addition to its Upper Extremities portfolio.
The company’s flagship platforms – SIMPLICITI and ASCEND FLEX shoulder systems – recorded considerable growth and also hold promise.
Notably, the INFINITY total ankle replacement system and SALVATION limb salvage system (for treating Charcot foot) boosted Wright Medical’s trajectory in the first quarter.
Quarter in Detail
Wright Medical currently reports revenues under the Total Extremities & Biologics segment.
Consolidated sales at the segment in the U.S. increased 6.1% from the year-ago quarter to almost $132.2 million. Internationally, sales in the extremities and biologics business were up 0.6% year over year to $45 million, driven by strong growth in the Canadian and Australian markets.
Total Extremities & Biologics include four sub-segments, namely, Lower Extremities, Upper Extremities, Biologics and Sports Med & Other.
Lower Extremities: Sales at the segment decreased 2.4% on a year-over-year basis to $69.1 million in the quarter.
The U.S. lower extremities business sales increased 0.3% in the first quarter. However, the business faced revenue dis-synergies of around 5% in the quarter.
Internationally, lower extremities sales fell 12.2% on a year-over-year basis.
Upper Extremities: Sales at the segment jumped 10.4% on a year-over-year basis to $78.3 million in the quarter under review.
The U.S. upper extremities business grew 11.9% on a year-over-year basis, courtesy of continued strength in the company’s shoulder portfolio. With the addition of PERFORM Reverse, the company forecasts solid growth at the segment, specifically in the back half of the year. Wright Medical also plans for additional rollout of PERFORM Reverse sets going ahead.
Upper extremities sales increased 6.9% on a year-over-year basis internationally.
Biologics: Sales at the segment rose 11.6% on a year-over-year basis to $23.8 million in the quarter.
The U.S. biologics business grew 8.8% to $18.6 million in the quarter. Per management, growth at the segment lagged expectations due to sluggish sales performance by the company’s flagship AUGMENT Bone Graft platform.
Sales at the segment grew a notable 23.2% internationally on a year-over-year basis.
Sports Med & Other: Sales at the segment dropped 4.3% to $5.9 million from the year-ago quarter.
The U.S. sports med & other segment sales declined 1.7%, and 5.7% internationally in the first quarter.
Margin Details
Adjusted gross margin, as a percentage of revenues, is pegged at 79.4% for the quarter, a contraction of roughly 90 basis points (bps) on a year-over-year basis.
Selling, general and administrative expenses accounted for 72% of total revenues in the first quarter, totaling $129.8 million, a contraction of 140 bps from the year-ago quarter.
Notably, expenses on Research and Development (R&D) were $12.4 million in the first quarter, almost flat on a year-over-year basis.
Guidance
Wright Medical reiterated its full-year guidance.
The company continues to expect net sales for full-year 2017 in the band of $755 million to $765 million, representing growth of 9% to 11%. This includes a negative impact from foreign currency exchange of approximately 2%. Notably, the midpoint of the net sales guidance represents constant currency growth of approximately 13%.
The company forecasts full-year 2017 adjusted EBITDA from continuing operations in the range of $78.5 million to $85.5 million.
Key Picks
Better-ranked stocks in the broader medical sector include Neovasc Inc. , Hologic, Inc. (HOLX - Free Report) and Sunshine Heart Inc . Notably, Neovasc and Hologic sport a Zacks Rank #1 (Strong Buy), while Sunshine Heart has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Hologic has a long-term expected earnings growth rate of 11.33%. The stock has a solid one-year return of roughly 33.8%.
Sunshine Heart posted a positive earnings surprise of 58.24% in the last reported quarter. The stock recorded a stellar EPS growth rate (last 3–5 years of actual earnings) of almost 22%.
Neovasc had a solid return of 8% over the last three months. The company projects sales growth of 102.88% for the current year.
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Wright Medical (WMGI) Posts Wider-than-Expected Loss in Q1
Wright Medical Group N.V. reported adjusted loss of 9 cents per share in the first quarter of 2017, wider than the Zacks Consensus Estimate of a loss of 8 cents.
However, loss narrowed by 3 cents on a year-over-year basis.
Net sales in the first quarter totaled $177 million which was below the consensus mark of $182 million.
Meanwhile, in three of the last four quarters, the company posted positive earnings surprises, the average being 20.4%. Currently, the stock has a Zacks Rank #4 (Sell).
Wright Medical Group N.V. Price, Consensus and EPS Surprise
Wright Medical Group N.V. Price, Consensus and EPS Surprise | Wright Medical Group N.V. Quote
Q1 Highlights
Wright Medical launched PERFORM Reversed Glenoid Shoulder System in the quarter, a significant addition to its Upper Extremities portfolio.
The company’s flagship platforms – SIMPLICITI and ASCEND FLEX shoulder systems – recorded considerable growth and also hold promise.
Notably, the INFINITY total ankle replacement system and SALVATION limb salvage system (for treating Charcot foot) boosted Wright Medical’s trajectory in the first quarter.
Quarter in Detail
Wright Medical currently reports revenues under the Total Extremities & Biologics segment.
Consolidated sales at the segment in the U.S. increased 6.1% from the year-ago quarter to almost $132.2 million. Internationally, sales in the extremities and biologics business were up 0.6% year over year to $45 million, driven by strong growth in the Canadian and Australian markets.
Total Extremities & Biologics include four sub-segments, namely, Lower Extremities, Upper Extremities, Biologics and Sports Med & Other.
Lower Extremities: Sales at the segment decreased 2.4% on a year-over-year basis to $69.1 million in the quarter.
The U.S. lower extremities business sales increased 0.3% in the first quarter. However, the business faced revenue dis-synergies of around 5% in the quarter.
Internationally, lower extremities sales fell 12.2% on a year-over-year basis.
Upper Extremities: Sales at the segment jumped 10.4% on a year-over-year basis to $78.3 million in the quarter under review.
The U.S. upper extremities business grew 11.9% on a year-over-year basis, courtesy of continued strength in the company’s shoulder portfolio. With the addition of PERFORM Reverse, the company forecasts solid growth at the segment, specifically in the back half of the year. Wright Medical also plans for additional rollout of PERFORM Reverse sets going ahead.
Upper extremities sales increased 6.9% on a year-over-year basis internationally.
Biologics: Sales at the segment rose 11.6% on a year-over-year basis to $23.8 million in the quarter.
The U.S. biologics business grew 8.8% to $18.6 million in the quarter. Per management, growth at the segment lagged expectations due to sluggish sales performance by the company’s flagship AUGMENT Bone Graft platform.
Sales at the segment grew a notable 23.2% internationally on a year-over-year basis.
Sports Med & Other: Sales at the segment dropped 4.3% to $5.9 million from the year-ago quarter.
The U.S. sports med & other segment sales declined 1.7%, and 5.7% internationally in the first quarter.
Margin Details
Adjusted gross margin, as a percentage of revenues, is pegged at 79.4% for the quarter, a contraction of roughly 90 basis points (bps) on a year-over-year basis.
Selling, general and administrative expenses accounted for 72% of total revenues in the first quarter, totaling $129.8 million, a contraction of 140 bps from the year-ago quarter.
Notably, expenses on Research and Development (R&D) were $12.4 million in the first quarter, almost flat on a year-over-year basis.
Guidance
Wright Medical reiterated its full-year guidance.
The company continues to expect net sales for full-year 2017 in the band of $755 million to $765 million, representing growth of 9% to 11%. This includes a negative impact from foreign currency exchange of approximately 2%. Notably, the midpoint of the net sales guidance represents constant currency growth of approximately 13%.
The company forecasts full-year 2017 adjusted EBITDA from continuing operations in the range of $78.5 million to $85.5 million.
Key Picks
Better-ranked stocks in the broader medical sector include Neovasc Inc. , Hologic, Inc. (HOLX - Free Report) and Sunshine Heart Inc . Notably, Neovasc and Hologic sport a Zacks Rank #1 (Strong Buy), while Sunshine Heart has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Hologic has a long-term expected earnings growth rate of 11.33%. The stock has a solid one-year return of roughly 33.8%.
Sunshine Heart posted a positive earnings surprise of 58.24% in the last reported quarter. The stock recorded a stellar EPS growth rate (last 3–5 years of actual earnings) of almost 22%.
Neovasc had a solid return of 8% over the last three months. The company projects sales growth of 102.88% for the current year.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>