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STERIS (STE) to Report Q3 Earnings: What's in the Cards?
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STERIS plc (STE - Free Report) is slated to report third-quarter fiscal 2021 results on Feb 2, after market close.
In the last-reported quarter, the company’s earnings per share (“EPS”) of $1.48 surpassed the Zacks Consensus Estimate by 19.4%. Moreover, its earnings surpassed the consensus estimate in each of the last four quarters. The trailing four-quarter average earnings surprise was 15.07%.
Let's see how things have shaped up prior to the announcement.
Factors at Play
After a choppy performance over the past few months, STERIS is expected to have recorded month-wise rebound in sales on gradual lifting of restrictions in many states and regions. Also, this quarter, the company might have experienced better performance related to deferrable procedures with hospitals gradually reopening their non-COVID-19 departments in a full-fledged way and opening up physician offices and clinics.
In this regard, we note that in the last-reported quarter, STERIS’ biggest segment — Healthcare — was impacted year over year by the reduction in deferrable procedure given a pull-back of non-COVID-19 procedures. However, the segment registered a sequential improvement in the last-reported quarter. This improvement is likely to have continued in fiscal third quarter due to the gradual resumption of procedures over the past few months.
Within Applied Sterilization Technologies (“AST”), we expect increased demand from the company’s core medical device customers to have pumped up sales. With the pandemic-led change in market behavior, we expect continued growth in AST facilities that process personal protective equipment like gowns and gloves and medical devices for the home settings like insulin pumps and blood glucose monitors. A significant recovery in procedure-related medical device sterilization volumes might have also contributed to the top line in the to-be-reported quarter.
Within Life Sciences, amid the pandemic scenario, the company might have continued to register benefit from pharma customers on growing vaccines and consumable revenue growth in its fiscal third quarter.
Capital equipment shipments are expected to have maintained the past few months' trend and rebounded on the back of return to more normal procedure volumes. However, the fresh wave of COVID-19 infections looms large on the company’s revenue growth.
STERIS rallied 8.6% compared with the industry’s 6.9% growth and the S&P 500's 11.7% rise between the period from October to December 2020 despite the challenges posed by the pandemic.
Q3 Estimates
The Zacks Consensus Estimate for third-quarter fiscal 2021 revenues is pegged at $795.6 million, suggesting an improvement of 2.8% from the year-ago reported figure.
The Zacks Consensus Estimate for the company’s third-quarter fiscal 2021 EPS of $1.56 cents suggests 7.6% uptick from the year-ago reported figure.
What Our Model Suggests
Per our proven model, a stock with a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has higher chances of beating estimates. However, this is not the case here as you can see:
Earnings ESP: STERIS has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #3.
Stocks Worth a Look
Here are a few medical stocks worth considering as these have the right combination of elements to beat on earnings this reporting cycle.
Patterson Companies, Inc. (PDCO - Free Report) has an Earnings ESP of +1.96% and a Zacks Rank of 2, at present.
DENTSPLY SIRONA Inc. (XRAY - Free Report) has an Earnings ESP of +4.45% and is a Zacks #2 Ranked stock.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
STERIS (STE) to Report Q3 Earnings: What's in the Cards?
STERIS plc (STE - Free Report) is slated to report third-quarter fiscal 2021 results on Feb 2, after market close.
In the last-reported quarter, the company’s earnings per share (“EPS”) of $1.48 surpassed the Zacks Consensus Estimate by 19.4%. Moreover, its earnings surpassed the consensus estimate in each of the last four quarters. The trailing four-quarter average earnings surprise was 15.07%.
Let's see how things have shaped up prior to the announcement.
Factors at Play
After a choppy performance over the past few months, STERIS is expected to have recorded month-wise rebound in sales on gradual lifting of restrictions in many states and regions. Also, this quarter, the company might have experienced better performance related to deferrable procedures with hospitals gradually reopening their non-COVID-19 departments in a full-fledged way and opening up physician offices and clinics.
In this regard, we note that in the last-reported quarter, STERIS’ biggest segment — Healthcare — was impacted year over year by the reduction in deferrable procedure given a pull-back of non-COVID-19 procedures. However, the segment registered a sequential improvement in the last-reported quarter. This improvement is likely to have continued in fiscal third quarter due to the gradual resumption of procedures over the past few months.
Within Applied Sterilization Technologies (“AST”), we expect increased demand from the company’s core medical device customers to have pumped up sales. With the pandemic-led change in market behavior, we expect continued growth in AST facilities that process personal protective equipment like gowns and gloves and medical devices for the home settings like insulin pumps and blood glucose monitors. A significant recovery in procedure-related medical device sterilization volumes might have also contributed to the top line in the to-be-reported quarter.
STERIS plc Price and EPS Surprise
STERIS plc price-eps-surprise | STERIS plc Quote
Within Life Sciences, amid the pandemic scenario, the company might have continued to register benefit from pharma customers on growing vaccines and consumable revenue growth in its fiscal third quarter.
Capital equipment shipments are expected to have maintained the past few months' trend and rebounded on the back of return to more normal procedure volumes. However, the fresh wave of COVID-19 infections looms large on the company’s revenue growth.
STERIS rallied 8.6% compared with the industry’s 6.9% growth and the S&P 500's 11.7% rise between the period from October to December 2020 despite the challenges posed by the pandemic.
Q3 Estimates
The Zacks Consensus Estimate for third-quarter fiscal 2021 revenues is pegged at $795.6 million, suggesting an improvement of 2.8% from the year-ago reported figure.
The Zacks Consensus Estimate for the company’s third-quarter fiscal 2021 EPS of $1.56 cents suggests 7.6% uptick from the year-ago reported figure.
What Our Model Suggests
Per our proven model, a stock with a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has higher chances of beating estimates. However, this is not the case here as you can see:
Earnings ESP: STERIS has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #3.
Stocks Worth a Look
Here are a few medical stocks worth considering as these have the right combination of elements to beat on earnings this reporting cycle.
Option Care Health, Inc. (OPCH - Free Report) has an Earnings ESP of +34.69% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Patterson Companies, Inc. (PDCO - Free Report) has an Earnings ESP of +1.96% and a Zacks Rank of 2, at present.
DENTSPLY SIRONA Inc. (XRAY - Free Report) has an Earnings ESP of +4.45% and is a Zacks #2 Ranked stock.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>