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Stryker (SYK) Earnings and Revenues Miss Estimates in Q3
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Stryker Corporation (SYK - Free Report) reported third-quarter 2021 adjusted earnings per share (EPS) of $2.20, which missed the Zacks Consensus Estimate of $2.28 by 3.5%. However, the bottom line improved 2.8% from the year-ago figure.
GAAP EPS in the quarter was $1.14, down 30.1% from the prior-year quarter.
Revenue Details
The Michigan-based medical device company reported revenues of $4.16 billion, which lagged the Zacks Consensus Estimate by 1.9%. However, the top line increased 11.3% on a year-over-year basis and 10.7% at constant currency (cc).
Revenues by Geography
Revenues in the United States were $3.02 billion, up 9.9% year over year. International sales were up 15.3% to $1.14 billion.
Segmental Analysis
Orthopaedics: In the quarter under review, revenues in the segment totaled $1.53 billion, up 16.1% year over year. The segment’s revenues rose 15.5% at cc. The upside can be attributed to strength in Trauma and Extremities and Knees sub segments, and strong demand for Mako.
Stryker Corporation Price, Consensus and EPS Surprise
MedSurg: This segment reported sales of $1.76 billion, which improved 9.4% on a year-over-year basis. Sales at the segment rose 8.9% at cc. Improvement across all its sub segments contributed to the upside. Per management, the segment saw 12% organic growth in the reported quarter.
Neurotechnology and Spine: Sales in the segment amounted to $876 million, up 7.3% year over year and 6.4% at cc. Per management, the upside was driven by double-digit growth in neurovascular, neurosurgical and interventional spine businesses.
Margins
In the third quarter, adjusted gross profit totaled $2.76 billion, up 12% from the year-ago quarter. Adjusted gross margin was 66.3%, up 40 basis points (bps).
Total operating expenses were $2.07 billion, up 29.1% from the year-ago quarter.
Adjusted operating income amounted to $1.06 billion, up 1.1% from the prior-year quarter. Adjusted operating margin was 25.4%, up 260 bps.
Financial Update
The company exited the third quarter with cash and cash equivalents of $2.56 billion, compared with $2.24 billion in the preceding quarter.
Cumulative net cash provided by operating activities in the third quarter was $2.26 billion, compared with $2.04 billion in the year-ago period.
2021 Outlook
The company will continue to track and evaluate the impact of the COVID-19 pandemic on its operations and financial results. Presently, Stryker anticipates organic net sales growth between 7% and 8% from that of 2019.
Adjusted EPS is projected in the band of $9.08 to $9.15 (which includes the impact of the buyout of Wright Medical for the full year). The Zacks Consensus Estimate for the same is pegged at $9.30.
Wrapping Up
Stryker exited third-quarter 2021 on a weak note, wherein both earnings and revenues lagged the Zacks Consensus Estimate. Nonetheless, the company witnessed strong performance across all three segments. Growth in international sales is an added positive. Expansion in both gross and operating margins in the reported quarter buoys optimism.
Per management, resurgence of COVID-19 weighed on the company’s U.S. implant related businesses due to deferral of scheduled procedures. Despite such disruptions, the company managed to deliver robust growth in its MedSurg and NeuroTech businesses.
However, Stryker continues to grapple with pricing pressure. Stiff competition in the MedTech space remains a concern.
Zacks Rank
Stryker currently carries a Zacks Rank #4 (Sell).
Earnings of Other MedTech Majors at a Glance
Some better-ranked stocks in the broader medical space that have already announced their quarterly results are Thermo Fisher Scientific Inc. (TMO - Free Report) , West Pharmaceutical Services, Inc. (WST - Free Report) , and AngioDynamics, Inc. (ANGO - Free Report) . While both Thermo Fisher and West Pharmaceutical carry a Zacks Rank of 2 (Buy), AngioDynamics sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Thermo Fisher reported third-quarter 2021 adjusted EPS of $5.76, which beat the Zacks Consensus Estimate by 23.3%. Third-quarter revenues of $9.33 billion outpaced the consensus mark by 12%.
West Pharmaceutical reported third-quarter 2021 adjusted EPS of $2.06, which surpassed the Zacks Consensus Estimate by 13.2%. Third-quarter revenues of $706.5 million outpaced the Zacks Consensus Estimate by 3.2%.
AngioDynamics reported first-quarter fiscal 2022 loss per share of 2 cents, narrower than the Zacks Consensus Estimate of a loss of 5 cents. Revenues of $76.9 million surpassed the Zacks Consensus Estimate by 8.4%.
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Stryker (SYK) Earnings and Revenues Miss Estimates in Q3
Stryker Corporation (SYK - Free Report) reported third-quarter 2021 adjusted earnings per share (EPS) of $2.20, which missed the Zacks Consensus Estimate of $2.28 by 3.5%. However, the bottom line improved 2.8% from the year-ago figure.
GAAP EPS in the quarter was $1.14, down 30.1% from the prior-year quarter.
Revenue Details
The Michigan-based medical device company reported revenues of $4.16 billion, which lagged the Zacks Consensus Estimate by 1.9%. However, the top line increased 11.3% on a year-over-year basis and 10.7% at constant currency (cc).
Revenues by Geography
Revenues in the United States were $3.02 billion, up 9.9% year over year. International sales were up 15.3% to $1.14 billion.
Segmental Analysis
Orthopaedics: In the quarter under review, revenues in the segment totaled $1.53 billion, up 16.1% year over year. The segment’s revenues rose 15.5% at cc. The upside can be attributed to strength in Trauma and Extremities and Knees sub segments, and strong demand for Mako.
Stryker Corporation Price, Consensus and EPS Surprise
Stryker Corporation price-consensus-eps-surprise-chart | Stryker Corporation Quote
MedSurg: This segment reported sales of $1.76 billion, which improved 9.4% on a year-over-year basis. Sales at the segment rose 8.9% at cc. Improvement across all its sub segments contributed to the upside. Per management, the segment saw 12% organic growth in the reported quarter.
Neurotechnology and Spine: Sales in the segment amounted to $876 million, up 7.3% year over year and 6.4% at cc. Per management, the upside was driven by double-digit growth in neurovascular, neurosurgical and interventional spine businesses.
Margins
In the third quarter, adjusted gross profit totaled $2.76 billion, up 12% from the year-ago quarter. Adjusted gross margin was 66.3%, up 40 basis points (bps).
Total operating expenses were $2.07 billion, up 29.1% from the year-ago quarter.
Adjusted operating income amounted to $1.06 billion, up 1.1% from the prior-year quarter. Adjusted operating margin was 25.4%, up 260 bps.
Financial Update
The company exited the third quarter with cash and cash equivalents of $2.56 billion, compared with $2.24 billion in the preceding quarter.
Cumulative net cash provided by operating activities in the third quarter was $2.26 billion, compared with $2.04 billion in the year-ago period.
2021 Outlook
The company will continue to track and evaluate the impact of the COVID-19 pandemic on its operations and financial results. Presently, Stryker anticipates organic net sales growth between 7% and 8% from that of 2019.
Adjusted EPS is projected in the band of $9.08 to $9.15 (which includes the impact of the buyout of Wright Medical for the full year). The Zacks Consensus Estimate for the same is pegged at $9.30.
Wrapping Up
Stryker exited third-quarter 2021 on a weak note, wherein both earnings and revenues lagged the Zacks Consensus Estimate. Nonetheless, the company witnessed strong performance across all three segments. Growth in international sales is an added positive. Expansion in both gross and operating margins in the reported quarter buoys optimism.
Per management, resurgence of COVID-19 weighed on the company’s U.S. implant related businesses due to deferral of scheduled procedures. Despite such disruptions, the company managed to deliver robust growth in its MedSurg and NeuroTech businesses.
However, Stryker continues to grapple with pricing pressure. Stiff competition in the MedTech space remains a concern.
Zacks Rank
Stryker currently carries a Zacks Rank #4 (Sell).
Earnings of Other MedTech Majors at a Glance
Some better-ranked stocks in the broader medical space that have already announced their quarterly results are Thermo Fisher Scientific Inc. (TMO - Free Report) , West Pharmaceutical Services, Inc. (WST - Free Report) , and AngioDynamics, Inc. (ANGO - Free Report) . While both Thermo Fisher and West Pharmaceutical carry a Zacks Rank of 2 (Buy), AngioDynamics sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Thermo Fisher reported third-quarter 2021 adjusted EPS of $5.76, which beat the Zacks Consensus Estimate by 23.3%. Third-quarter revenues of $9.33 billion outpaced the consensus mark by 12%.
West Pharmaceutical reported third-quarter 2021 adjusted EPS of $2.06, which surpassed the Zacks Consensus Estimate by 13.2%. Third-quarter revenues of $706.5 million outpaced the Zacks Consensus Estimate by 3.2%.
AngioDynamics reported first-quarter fiscal 2022 loss per share of 2 cents, narrower than the Zacks Consensus Estimate of a loss of 5 cents. Revenues of $76.9 million surpassed the Zacks Consensus Estimate by 8.4%.