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Shares of Integer Holdings Corporation (ITGR - Free Report) scaled a new 52-week high of $89.62 on Jun 30, before closing the session marginally lower at $88.61.
Over the past year, this Zacks Rank #3 (Hold) stock has gained 23.1% compared with 12.4% growth of the industry and a 16.5% rise of the S&P 500 composite.
Over the past five years, the company registered earnings growth of 4.8% compared with the industry’s 4.2% rise. The company’s long-term expected growth rate of 11.9% compares with the industry’s growth projection of 15.4%. Integer Holdings’ earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed once, the average surprise being 1.7%.
Image Source: Zacks Investment Research
Integer Holdings is witnessing an upward trend in its stock price, prompted by its improving non-medical sales. The optimism led by a solid first-quarter 2023 performance and its solid foothold in the broader MedTech space are expected to contribute further. However, dependence on third-party suppliers and stiff competition continues to concern the company.
Let’s delve deeper.
Key Growth Drivers
Improving Non-Medical Sales: We are upbeat about Integer Holdings’ improvement in its Non-Medical sales. In the first quarter of 2023, revenues at the Non-Medical Sales segment rose 63.4% year over year. The upside was driven by strong sales at the Electrochem product line, part of the Non-Medical segment, across all market segments and continued supplier delivery recovery.
Solid Foothold in the Broader MedTech Space: We are optimistic about Integer Holdings’ stable footing in the cardiac, neuromodulation, orthopedics, vascular and advanced surgical markets. Its primary customers include large, multi-national original equipment manufacturers and their affiliated subsidiaries.
Integer Holdings has been focusing on its sales efforts to increase its market penetration in the Cardio & Vascular, Neuromodulation and Non-Medical Electrochem markets. The company is also making strategic initiatives to maintain its leadership position in the cardiac rhythm management market.
Strong Q1 Results: Integer Holdings’ robust first-quarter 2023 results raise our optimism. The company registered strong year-over-year top-line and bottom-line performances. Robust performances by both segments and strength in all three product lines of the Medical Sales segment were also recorded. The expansion of the adjusted operating margin bodes well for the stock.
Downsides
Stiff Competition: Competition with respect to the manufacturing of Integer Holdings’ medical products across all its product lines has intensified in recent years and may continue to do so in the future. The market for commercial power sources is competitive, fragmented and subject to rapid technological change. Many other commercial power source suppliers are larger than Integer Holdings and have greater resources, which may help them develop superior (technologically or otherwise) or more cost-effective products than the latter, thus resulting in lower revenues and operating results for Integer Holdings.
Dependence on Third-Party Suppliers: Integer Holdings’ business depends on a continuous supply of raw materials, which may be susceptible to fluctuations due to transportation issues, government regulations and price controls, among others. Significant increases in the cost of raw materials, which cannot be recovered through increases in the prices of the company’s products, could adversely affect its operating results.
Key Picks
Some better-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , HealthEquity, Inc. (HQY - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Hologic, carrying a Zacks Rank #2 (Buy) at present, has an estimated growth rate of 5.1% for fiscal 2024. HOLX’s earnings surpassed estimates in all the trailing four quarters, the average being 27.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hologic has gained 15.4% compared with the industry’s 12.4% rise in the past year.
HealthEquity, sporting a Zacks Rank #1 at present, has an estimated long-term growth rate of 22%. HQY’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 9.1%.
HealthEquity has gained 9.5% against the industry’s 13.8% decline over the past year.
Boston Scientific, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 11.5%. BSX’s earnings surpassed estimates in two of the trailing four quarters and missed in the other two, the average surprise being 1.9%.
Boston Scientific has gained 42.3% against the industry’s 21.7% decline over the past year.
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Integer Holdings (ITGR) Hits 52-Week High: What's Aiding It?
Shares of Integer Holdings Corporation (ITGR - Free Report) scaled a new 52-week high of $89.62 on Jun 30, before closing the session marginally lower at $88.61.
Over the past year, this Zacks Rank #3 (Hold) stock has gained 23.1% compared with 12.4% growth of the industry and a 16.5% rise of the S&P 500 composite.
Over the past five years, the company registered earnings growth of 4.8% compared with the industry’s 4.2% rise. The company’s long-term expected growth rate of 11.9% compares with the industry’s growth projection of 15.4%. Integer Holdings’ earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters and missed once, the average surprise being 1.7%.
Image Source: Zacks Investment Research
Integer Holdings is witnessing an upward trend in its stock price, prompted by its improving non-medical sales. The optimism led by a solid first-quarter 2023 performance and its solid foothold in the broader MedTech space are expected to contribute further. However, dependence on third-party suppliers and stiff competition continues to concern the company.
Let’s delve deeper.
Key Growth Drivers
Improving Non-Medical Sales: We are upbeat about Integer Holdings’ improvement in its Non-Medical sales. In the first quarter of 2023, revenues at the Non-Medical Sales segment rose 63.4% year over year. The upside was driven by strong sales at the Electrochem product line, part of the Non-Medical segment, across all market segments and continued supplier delivery recovery.
Solid Foothold in the Broader MedTech Space: We are optimistic about Integer Holdings’ stable footing in the cardiac, neuromodulation, orthopedics, vascular and advanced surgical markets. Its primary customers include large, multi-national original equipment manufacturers and their affiliated subsidiaries.
Integer Holdings has been focusing on its sales efforts to increase its market penetration in the Cardio & Vascular, Neuromodulation and Non-Medical Electrochem markets. The company is also making strategic initiatives to maintain its leadership position in the cardiac rhythm management market.
Strong Q1 Results: Integer Holdings’ robust first-quarter 2023 results raise our optimism. The company registered strong year-over-year top-line and bottom-line performances. Robust performances by both segments and strength in all three product lines of the Medical Sales segment were also recorded. The expansion of the adjusted operating margin bodes well for the stock.
Downsides
Stiff Competition: Competition with respect to the manufacturing of Integer Holdings’ medical products across all its product lines has intensified in recent years and may continue to do so in the future. The market for commercial power sources is competitive, fragmented and subject to rapid technological change. Many other commercial power source suppliers are larger than Integer Holdings and have greater resources, which may help them develop superior (technologically or otherwise) or more cost-effective products than the latter, thus resulting in lower revenues and operating results for Integer Holdings.
Dependence on Third-Party Suppliers: Integer Holdings’ business depends on a continuous supply of raw materials, which may be susceptible to fluctuations due to transportation issues, government regulations and price controls, among others. Significant increases in the cost of raw materials, which cannot be recovered through increases in the prices of the company’s products, could adversely affect its operating results.
Key Picks
Some better-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , HealthEquity, Inc. (HQY - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Hologic, carrying a Zacks Rank #2 (Buy) at present, has an estimated growth rate of 5.1% for fiscal 2024. HOLX’s earnings surpassed estimates in all the trailing four quarters, the average being 27.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hologic has gained 15.4% compared with the industry’s 12.4% rise in the past year.
HealthEquity, sporting a Zacks Rank #1 at present, has an estimated long-term growth rate of 22%. HQY’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 9.1%.
HealthEquity has gained 9.5% against the industry’s 13.8% decline over the past year.
Boston Scientific, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 11.5%. BSX’s earnings surpassed estimates in two of the trailing four quarters and missed in the other two, the average surprise being 1.9%.
Boston Scientific has gained 42.3% against the industry’s 21.7% decline over the past year.