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Conmed (CNMD) Down 0.4% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for Conmed (CNMD - Free Report) . Shares have lost about 0.4% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Conmed 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.
CONMED Beats on Q1 Earnings, Raises ‘19 Guidance
CONMED Corporation reported first-quarter 2019 adjusted earnings per share of 57 cents, which beat the Zacks Consensus Estimate of 54 cents by 5.6%. Further, the figure improved 7.5% from the year-ago quarter.
The New York-based medical products manufacturer posted revenues of $218.4 million, up 8.1% on a year-over-year basis and 9.3% at constant currency (cc). Notably, the figure surpassed the Zacks Consensus Estimate of $213 million by 2.5%.
Segment Details
Orthopedic Surgery
Revenues in the segment totaled $113.4 million, up 4.1% from the year-ago quarter.
Domestically, Orthopedics revenues increased 4.9% from the prior-year quarter's level, while international sales rose 3.8%. Per management, growth was driven by strong performances of the product portfolio.
General Surgery
Revenues in the segment totaled $105 million, up 12.7% year over year.
Domestically, General Surgery sales improved 13.7% year over year and international sales increased 10.2%.
Sales by Geography
In the reported quarter, sales in the United States grossed $117 million, up 10.1% year over year. International sales climbed 5.8% to $101.4 million.
Margins
Gross profit in the quarter totaled $122.1 million, up 11.4% year over year. Per management, adjusted gross margin was 55.9%, expanding 170 bps.
Adjusted operating income came in at $11.6 million, down 32.6% year over year. Operating margin was 44.1%, down 320 bps year over year.
Financial Condition
Cash flow from operations in the first quarter was $3.9 million compared with $25 million in the year-ago quarter. Long-term debt at the end of the quarter was $803 million, up 82.9% from 2018-end level.
2019 Guidance Raised
CONMED expects 2019 sales growth in the range of 9-10% at cc. This projection includes an increase to its organic constant currency sales growth in the range of 5.25-6.25% and the addition of the Buffalo Filter buyout.
On the basis of current exchange rates, the negative impact to 2019 sales from forex is now anticipated to be about 75 bps, lower than the prior estimate of 100 bps.
The company forecasts adjusted diluted net earnings per share in the range of $2.47 to $2.52, up from the previously guided range of $2.42-$2.47. This indicates growth of 13-16% over 2018. Notably, the Zacks Consensus Estimate is pegged at $2.45, within the guided range.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
At this time, Conmed has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise Conmed has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
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Conmed (CNMD) Down 0.4% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Conmed (CNMD - Free Report) . Shares have lost about 0.4% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Conmed 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.
CONMED Beats on Q1 Earnings, Raises ‘19 Guidance
CONMED Corporation reported first-quarter 2019 adjusted earnings per share of 57 cents, which beat the Zacks Consensus Estimate of 54 cents by 5.6%. Further, the figure improved 7.5% from the year-ago quarter.
The New York-based medical products manufacturer posted revenues of $218.4 million, up 8.1% on a year-over-year basis and 9.3% at constant currency (cc). Notably, the figure surpassed the Zacks Consensus Estimate of $213 million by 2.5%.
Segment Details
Orthopedic Surgery
Revenues in the segment totaled $113.4 million, up 4.1% from the year-ago quarter.
Domestically, Orthopedics revenues increased 4.9% from the prior-year quarter's level, while international sales rose 3.8%. Per management, growth was driven by strong performances of the product portfolio.
General Surgery
Revenues in the segment totaled $105 million, up 12.7% year over year.
Domestically, General Surgery sales improved 13.7% year over year and international sales increased 10.2%.
Sales by Geography
In the reported quarter, sales in the United States grossed $117 million, up 10.1% year over year. International sales climbed 5.8% to $101.4 million.
Margins
Gross profit in the quarter totaled $122.1 million, up 11.4% year over year. Per management, adjusted gross margin was 55.9%, expanding 170 bps.
Adjusted operating income came in at $11.6 million, down 32.6% year over year. Operating margin was 44.1%, down 320 bps year over year.
Financial Condition
Cash flow from operations in the first quarter was $3.9 million compared with $25 million in the year-ago quarter. Long-term debt at the end of the quarter was $803 million, up 82.9% from 2018-end level.
2019 Guidance Raised
CONMED expects 2019 sales growth in the range of 9-10% at cc. This projection includes an increase to its organic constant currency sales growth in the range of 5.25-6.25% and the addition of the Buffalo Filter buyout.
On the basis of current exchange rates, the negative impact to 2019 sales from forex is now anticipated to be about 75 bps, lower than the prior estimate of 100 bps.
The company forecasts adjusted diluted net earnings per share in the range of $2.47 to $2.52, up from the previously guided range of $2.42-$2.47. This indicates growth of 13-16% over 2018. Notably, the Zacks Consensus Estimate is pegged at $2.45, within the guided range.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
VGM Scores
At this time, Conmed has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. It comes with little surprise Conmed has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.