It has been about a month since the last earnings report for NuVasive, Inc. . Shares have added about 4.6% in that time frame.
Will the recent positive trend continue leading up to its next earnings release, or is NUVA due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Recent Earnings
NuVasive reported fourth-quarter 2017 adjusted earnings per share (EPS) of 56 cents, reflecting a 5.7% rise from the year-ago quarter. The figure was on par with the Zacks Consensus Estimate.
Solid contributions from the international business led to the year-over-year improvement in earnings.
Including one-time items, the company reported fourth-quarter 2017 net income per share of 46 cents, up 318.2% from 11 cents a year ago.
Full-year 2017 adjusted EPS came in at $1.91, in line with the Zacks Consensus Estimate. Moreover, the figure improved from the year-ago number by 15.1%.
Revenues in the reported quarter came in at $271.7 million, marginally up (flat at constant exchange rate or CER) from the year-ago figure of $271.1 million. The figure, however, missed the Zacks Consensus Estimate of $272.3 million.
Net revenues in 2017 totaled $1.03 billion, in line with the Zacks Consensus Estimate. The figure also improved 7% from the year-ago number.
Notably, the company announced preliminary results on Jan 8.
In the quarter, the company witnessed robust performance in the international market. However, the upside was marred by a decline in U.S. revenues. Notably, pressure in the biologics business, softness in procedural volumes in the U.S. spine market followed by difficult comparisons to the year-ago figure led to the disappointing performance in the United States. However, management is satisfied with the key volume growth in the core hardware business.
Notably, the company faced a $1.5-million headwind in the international business after the hurricanes hit Puerto Rico in 2017.
In the reported quarter, the company’s U.S. Spinal Hardware business declined around 4%. However, revenues in this business were flat, after adjusting the year-ago figure for MAGEC sales of $4.8 million. Notably, rise in pricing pressure and product mix had offset case volume growth of around 5%.
Revenues from U.S. Surgical Support business declined around 10% in the fourth quarter, primarily due to weakness in the biologics portfolio along with persistent sluggishness in the U.S. service business case volume growth.
However, the international business recorded 34% growth at CER or 35% on a reported basis for the fifth consecutive time on solid contributions from key geographies.
In the reported quarter, there was a 12.7% increase in cost of goods sold after excluding amortization of intangible assets expenses. Accordingly, gross profit declined 3.9% to $196.3 million. Moreover, the company reported a 310-basis point (bps) year-over-year contraction in gross margin to 72.2% in the fourth quarter.
Sales, marketing and administrative expenses went down 5.5% to $134.5 million, while research and development expenses contracted 1.6% to $12.7 million.
NuVasive posted adjusted operating income of $49.1 million in the reported quarter, reflecting a 0.4% rise from the year-ago figure. Adjusted operating margin expanded 10 bps to 18.1% in the quarter.
The company exited 2017 with cash, cash equivalents and short-term investments of $76.7 million, down from $153.6 million at the end of 2016.
Outlook
NuVasive provided the guidance for full-year 2018 as well. The guidance has been adjusted for the recent buyout of SafePassage, full-year benefit of U.S. tax reform and suspension of the medical device tax.
The company expects 2018 revenues in the range of $1.095 billion to $1.105 billion, reflecting 4.4% to 5.4% organic growth. Moreover, on a reported basis, the company expects revenue growth in the range of 6.4% to 7.3%. The Zacks Consensus Estimate of $1.08 billion lags the guided range. Foreign exchange rates are expected to prove favorable for NuVasive in 2018. In fact, the company expects foreign exchange rates to have a positive impact of almost $5 million for the year.
NuVasive expects full-year 2017 adjusted EPS within $2.44-$2.47. The current Zacks Consensus Estimate of $2.41 lags the guided range. Additionally, adjusted operating margin for the year is expected at 17.6%, up 100 bps on a year-over-year basis.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates. There has been one revision higher for the current quarter compared to three lower. While look
NuVasive, Inc. Price and Consensus
VGM Scores
At this time, NUVA has a nice Growth Score of B, a grade with the same score on the momentum front. Following the exact same course, the stock was also allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Based on our scores, the stock is equally suitable for value, growth, and momentum investors.
Outlook
Estimates have been broadly trending downward for the stock and the magnitude of these revisions indicates a downward shift. Notably, NUVA 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) Up 4.6% Since Its Last Earnings Report?
It has been about a month since the last earnings report for NuVasive, Inc. . Shares have added about 4.6% in that time frame.
Will the recent positive trend continue leading up to its next earnings release, or is NUVA due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Recent Earnings
NuVasive reported fourth-quarter 2017 adjusted earnings per share (EPS) of 56 cents, reflecting a 5.7% rise from the year-ago quarter. The figure was on par with the Zacks Consensus Estimate.
Solid contributions from the international business led to the year-over-year improvement in earnings.
Including one-time items, the company reported fourth-quarter 2017 net income per share of 46 cents, up 318.2% from 11 cents a year ago.
Full-year 2017 adjusted EPS came in at $1.91, in line with the Zacks Consensus Estimate. Moreover, the figure improved from the year-ago number by 15.1%.
Revenues in the reported quarter came in at $271.7 million, marginally up (flat at constant exchange rate or CER) from the year-ago figure of $271.1 million. The figure, however, missed the Zacks Consensus Estimate of $272.3 million.
Net revenues in 2017 totaled $1.03 billion, in line with the Zacks Consensus Estimate. The figure also improved 7% from the year-ago number.
Notably, the company announced preliminary results on Jan 8.
In the quarter, the company witnessed robust performance in the international market. However, the upside was marred by a decline in U.S. revenues. Notably, pressure in the biologics business, softness in procedural volumes in the U.S. spine market followed by difficult comparisons to the year-ago figure led to the disappointing performance in the United States. However, management is satisfied with the key volume growth in the core hardware business.
Notably, the company faced a $1.5-million headwind in the international business after the hurricanes hit Puerto Rico in 2017.
In the reported quarter, the company’s U.S. Spinal Hardware business declined around 4%. However, revenues in this business were flat, after adjusting the year-ago figure for MAGEC sales of $4.8 million. Notably, rise in pricing pressure and product mix had offset case volume growth of around 5%.
Revenues from U.S. Surgical Support business declined around 10% in the fourth quarter, primarily due to weakness in the biologics portfolio along with persistent sluggishness in the U.S. service business case volume growth.
However, the international business recorded 34% growth at CER or 35% on a reported basis for the fifth consecutive time on solid contributions from key geographies.
In the reported quarter, there was a 12.7% increase in cost of goods sold after excluding amortization of intangible assets expenses. Accordingly, gross profit declined 3.9% to $196.3 million. Moreover, the company reported a 310-basis point (bps) year-over-year contraction in gross margin to 72.2% in the fourth quarter.
Sales, marketing and administrative expenses went down 5.5% to $134.5 million, while research and development expenses contracted 1.6% to $12.7 million.
NuVasive posted adjusted operating income of $49.1 million in the reported quarter, reflecting a 0.4% rise from the year-ago figure. Adjusted operating margin expanded 10 bps to 18.1% in the quarter.
The company exited 2017 with cash, cash equivalents and short-term investments of $76.7 million, down from $153.6 million at the end of 2016.
Outlook
NuVasive provided the guidance for full-year 2018 as well. The guidance has been adjusted for the recent buyout of SafePassage, full-year benefit of U.S. tax reform and suspension of the medical device tax.
The company expects 2018 revenues in the range of $1.095 billion to $1.105 billion, reflecting 4.4% to 5.4% organic growth. Moreover, on a reported basis, the company expects revenue growth in the range of 6.4% to 7.3%. The Zacks Consensus Estimate of $1.08 billion lags the guided range. Foreign exchange rates are expected to prove favorable for NuVasive in 2018. In fact, the company expects foreign exchange rates to have a positive impact of almost $5 million for the year.
NuVasive expects full-year 2017 adjusted EPS within $2.44-$2.47. The current Zacks Consensus Estimate of $2.41 lags the guided range. Additionally, adjusted operating margin for the year is expected at 17.6%, up 100 bps on a year-over-year basis.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates. There has been one revision higher for the current quarter compared to three lower. While look
NuVasive, Inc. Price and Consensus
NuVasive, Inc. Price and Consensus | NuVasive, Inc. Quote
VGM Scores
At this time, NUVA has a nice Growth Score of B, a grade with the same score on the momentum front. Following the exact same course, the stock was also allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Based on our scores, the stock is equally suitable for value, growth, and momentum investors.
Outlook
Estimates have been broadly trending downward for the stock and the magnitude of these revisions indicates a downward shift. Notably, NUVA has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.