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Glaukos (GKOS) Down 2.5% Since Last Earnings Report: Can It Rebound?

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It has been about a month since the last earnings report for Glaukos (GKOS - Free Report) . Shares have lost about 2.5% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Glaukos due for a breakout? 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 drivers.

Glaukos Beats on Q4 Earnings, Gross Margin Down

Glaukos reported earnings of 4 cents per share in the fourth quarter of 2018, outpacing the Zacka Consensus Estimate of a loss of 13 cents.

Revenues totaled $54.1 million, which surpassed the Zacks Consensus Estimate of $49 million.

Full-Year Results at a Glance

In 2018, Glaukos’ net revenues rose 14% on a year-over-yeas basis to $181.3 million compared with $159.3 million in 2017. The improvement was driven by unit volume gains worldwide and strengthening of the company’s direct sales operations into international markets.

Quarter Details

Gross margin for the fourth quarter was approximately 87% of net revenues, down 200 basis points on a year-over-year basis.

Operating expenses increased 23% to $45.1 million on a year-over-year basis. This uptick was driven by growth in domestic sales, marketing and administrative personnel and expenses. These apart, Glaukos’ expansion of global direct sales infrastructure, and increased spending associated with pharmaceutical research and clinical trials increased operating expenses.

Guidance

For 2019, Glaukos issued net sales guidance in the range of $220-$230 million. This guidance takes into account the company’s organic growth, the updated MIGS market landscape and competitive dynamics.

Management at Glaukos expects mid-teens market growth for 2019 time period.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates flatlined during the past month. The consensus estimate has shifted 5% due to these changes.

VGM Scores

Currently, Glaukos has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. However, the stock was allocated a grade of F on the value side, putting it in the bottom 20% quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Glaukos has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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