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Stryker (SYK) to Report Q2 Earnings: What's in the Cards?
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Stryker Corporation (SYK - Free Report) is scheduled to release second-quarter 2023 results on Aug 3, after market close. In the last reported quarter, the company delivered an earnings surprise of 7.00%.
Q2 Estimates
The Zacks Consensus Estimate for earnings is pegged at $2.38 per share, indicating an increase of 5.8% year over year.
The consensus mark for revenues is pinned at $4.83 billion, implying growth of 7.5% from the prior-year quarter’s reported figure.
Factors to Note
Stryker's MedSurg and Neurotechnology segment witnessed substantial sales growth on the back of robust performance of subsegments in the first quarter. Strong performances in Europe, Australia, Canada and Japan also boosted revenues. This trend is likely to have continued in the second quarter.
Growth across Orthopaedics & Spine’s Hip, Knee, and Trauma and Extremities subsegments might have favored the segment's performance on the back of continued procedural growth, strong uptake of the Insignia Hip Stem and the recent launch of the Q Guidance Navigation System.
Stryker witnessed both domestic and international growth (in Japan, Korea and emerging markets) in the first quarter of 2023. It is committed to the sustained expansion of Mako, reflecting robust demand for this differentiated robotic technology. This heightened demand is likely to have contributed to the Orthopaedics & Spine segment's performance in the soon-to-be-reported quarter. However, variability in the hospital environment might have offset some of the gains.
The company’s prospects in 2023 seem promising on the back of strong customer demand for its existing as well as new products. However, ongoing hospital staffing pressures and foreign currency movements are likely to have hurt its sales growth.
Procedural volumes in China might have suffered a negative impact owing to strict lockdown restrictions across major cities in the country. However, the impact of the economy’s recent reopening is yet to be seen. The current inflationary pressure is likely to have hurt SYK’s net margin, thereby limiting its growth.
Stryker is working toward alleviating the rising inflationary pressure. It is also taking several cost-cutting initiatives, including restructuring plans. Although these steps may help boost the company’s growth, they are also likely to drive expenses in the upcoming quarters. On SYK’s second-quarter earnings call, investors are likely to question the progress of these strategic initiatives and their impact going forward.
SYK launched autonomous guidance systems, Ortho Q Guidance and Q Guidance system with Cranial Guidance software in the United States earlier this month. On its second-quarter earnings call, the company provided updates on the launch progress for these two systems.
Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) increases the chances of an earnings beat. This is not the case here as you will see below.
Earnings ESP: Stryker 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 #2.
Stocks to Consider
Here are some medical stocks worth considering as these have the right combination of elements to post an earnings beat this reporting cycle.
The stock has gained 9.5% year to date. MCK’s earnings beat estimates in the last reported quarter. It has a four-quarter earnings surprise of 4.48%, on average.
Avanos Medical (AVNS - Free Report) has an Earnings ESP of +0.74% and a Zacks Rank of 3 at present.
The stock has lost 3.5% year to date. AVNS’ earnings missed estimates in the last reported quarter. It has a trailing four-quarter average earnings surprise of 8.03%.
Pacific Biosciences of California (PACB - Free Report) has an Earnings ESP of +5.88% and a Zacks Rank of 3 at present.
The stock has gained 67.3% year to date. PACB’s earnings beat estimates in the last reported quarter. It has a negative four-quarter average earnings surprise of 3.66%.
Image: Shutterstock
Stryker (SYK) to Report Q2 Earnings: What's in the Cards?
Stryker Corporation (SYK - Free Report) is scheduled to release second-quarter 2023 results on Aug 3, after market close. In the last reported quarter, the company delivered an earnings surprise of 7.00%.
Q2 Estimates
The Zacks Consensus Estimate for earnings is pegged at $2.38 per share, indicating an increase of 5.8% year over year.
The consensus mark for revenues is pinned at $4.83 billion, implying growth of 7.5% from the prior-year quarter’s reported figure.
Factors to Note
Stryker's MedSurg and Neurotechnology segment witnessed substantial sales growth on the back of robust performance of subsegments in the first quarter. Strong performances in Europe, Australia, Canada and Japan also boosted revenues. This trend is likely to have continued in the second quarter.
Growth across Orthopaedics & Spine’s Hip, Knee, and Trauma and Extremities subsegments might have favored the segment's performance on the back of continued procedural growth, strong uptake of the Insignia Hip Stem and the recent launch of the Q Guidance Navigation System.
Stryker witnessed both domestic and international growth (in Japan, Korea and emerging markets) in the first quarter of 2023. It is committed to the sustained expansion of Mako, reflecting robust demand for this differentiated robotic technology. This heightened demand is likely to have contributed to the Orthopaedics & Spine segment's performance in the soon-to-be-reported quarter. However, variability in the hospital environment might have offset some of the gains.
The company’s prospects in 2023 seem promising on the back of strong customer demand for its existing as well as new products. However, ongoing hospital staffing pressures and foreign currency movements are likely to have hurt its sales growth.
Procedural volumes in China might have suffered a negative impact owing to strict lockdown restrictions across major cities in the country. However, the impact of the economy’s recent reopening is yet to be seen. The current inflationary pressure is likely to have hurt SYK’s net margin, thereby limiting its growth.
Stryker is working toward alleviating the rising inflationary pressure. It is also taking several cost-cutting initiatives, including restructuring plans. Although these steps may help boost the company’s growth, they are also likely to drive expenses in the upcoming quarters. On SYK’s second-quarter earnings call, investors are likely to question the progress of these strategic initiatives and their impact going forward.
SYK launched autonomous guidance systems, Ortho Q Guidance and Q Guidance system with Cranial Guidance software in the United States earlier this month. On its second-quarter earnings call, the company provided updates on the launch progress for these two systems.
Stryker Corporation Price and Consensus
Stryker Corporation price-consensus-chart | Stryker Corporation Quote
What Our Quantitative Model Suggests
Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) increases the chances of an earnings beat. This is not the case here as you will see below.
Earnings ESP: Stryker 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 #2.
Stocks to Consider
Here are some medical stocks worth considering as these have the right combination of elements to post an earnings beat this reporting cycle.
McKesson (MCK - Free Report) has an Earnings ESP of +1.93% and a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The stock has gained 9.5% year to date. MCK’s earnings beat estimates in the last reported quarter. It has a four-quarter earnings surprise of 4.48%, on average.
Avanos Medical (AVNS - Free Report) has an Earnings ESP of +0.74% and a Zacks Rank of 3 at present.
The stock has lost 3.5% year to date. AVNS’ earnings missed estimates in the last reported quarter. It has a trailing four-quarter average earnings surprise of 8.03%.
Pacific Biosciences of California (PACB - Free Report) has an Earnings ESP of +5.88% and a Zacks Rank of 3 at present.
The stock has gained 67.3% year to date. PACB’s earnings beat estimates in the last reported quarter. It has a negative four-quarter average earnings surprise of 3.66%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.