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Integra Gains From New Product Launches, Mounting Costs Ail
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Integra LifeSciences (IART - Free Report) is gaining from a series of product introductions, acquisitions and strong overseas expansion. However, product recall issues dent growth. The stock carries a Zacks Rank #3 (Hold).
Integra sees healthy demand for its industry-leading products within Codman Specialty Surgical (“CSS”). The segment is benefiting from the growing market acceptance of the company’s global neurosurgery line-ups, including CSS management and neuromonitoring. Within CSS management, Integra is experiencing growth, banking on the strong market adoption of programmable valves and advanced energy (the key revenue-generating products are CUSA Capital, Mayfield, DuraGen, Certas Plus programmable valves, Bactiseal catheters and instruments).
The company has expanded the international reach of the CUSA platform and registered DuraGen, DuraSeal, Mayfield and Duo LED lighting in the EMEA and Latin America.
Also, Integra's Tissue Technologies business is continuously gaining traction on efficient growth strategies and a better price management policy. The wound reconstruction subcategory within Tissue Technologies is rebounding fast, banking on robust sales in Integra Skin and SurgiMend.
Further, the ACell franchise is driving better results. In the Tissue Technologies division, the company launched NeuraGen 3D, a unique mid-cap nerve repair product.
However, the challenging macroeconomic scenario, specifically in the Asia Pacific and Europe, is driving higher-than-anticipated inflation in terms of raw materials and labor costs. These could also result in broader economic impacts and security concerns, affecting the company’s business through 2023.
Higher freight costs, ongoing labor inflation and manufacturing and supply-chain inefficiencies continued to put significant pressure on Integra’s margins in recent times. IART’s SG&A expenses rose 12.6% in the third quarter of 2023. In the quarter, the unfavorable product and geographic mix and Boston recall issue-related expenses laid significant pressure on the company’s margins. Our estimates indicate 6.9% and 2.3% increases in SG&A expenses for 2023 and 2024, respectively.
In May 2023, Integra had to voluntarily recall the manufacturing of its key products like PriMatrix, SurgiMend, Revize and TissueMend from its Boston, MA, manufacturing facility. In the second quarter of 2023, the company reported a decline in global revenues, primarily as the result of this recall, which affected both Domestic and International sales.
Further, due to the voluntary recall, the company recorded a $24.1 million write-off of inventory that could no longer be sold. In June, Integra submitted an initial response to the audit findings but currently expects the matter to get resolved not before 2023 end.
Over the past year, shares of IART have declined 27.4% compared with the industry’s 4.7% drop.
Haemonetics’ stock has decreased 0.5% in the past year. Earnings estimates for Haemonetics have increased from $3.82 to $3.89 in 2023 and $4.07 to $4.15 in 2024 in the past 30 days.
HAE’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 16.1%. In the last reported quarter, it posted an earnings surprise of 5.3%.
Estimates for DexCom’s 2023 earnings per share have increased from $1.39 to $1.43 in the past 30 days. Shares of the company have increased 0.1% in the past year compared with the industry’s decline of 4.7%.
DXCM’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 36.4%. In the last reported quarter, it delivered an average earnings surprise of 47.1%.
Estimates for Insulet’s 2023 earnings per share have increased from $1.61 to $1.91 in the past 30 days. Shares of the company have dropped 36.5% in the past year compared with the industry’s decline of 3.3%.
PODD’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 105.1%. In the last reported quarter, it delivered an average earnings surprise of 77.4%.
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Integra Gains From New Product Launches, Mounting Costs Ail
Integra LifeSciences (IART - Free Report) is gaining from a series of product introductions, acquisitions and strong overseas expansion. However, product recall issues dent growth. The stock carries a Zacks Rank #3 (Hold).
Integra sees healthy demand for its industry-leading products within Codman Specialty Surgical (“CSS”). The segment is benefiting from the growing market acceptance of the company’s global neurosurgery line-ups, including CSS management and neuromonitoring. Within CSS management, Integra is experiencing growth, banking on the strong market adoption of programmable valves and advanced energy (the key revenue-generating products are CUSA Capital, Mayfield, DuraGen, Certas Plus programmable valves, Bactiseal catheters and instruments).
The company has expanded the international reach of the CUSA platform and registered DuraGen, DuraSeal, Mayfield and Duo LED lighting in the EMEA and Latin America.
Also, Integra's Tissue Technologies business is continuously gaining traction on efficient growth strategies and a better price management policy. The wound reconstruction subcategory within Tissue Technologies is rebounding fast, banking on robust sales in Integra Skin and SurgiMend.
Integra LifeSciences Holdings Corporation Price
Integra LifeSciences Holdings Corporation price | Integra LifeSciences Holdings Corporation Quote
Further, the ACell franchise is driving better results. In the Tissue Technologies division, the company launched NeuraGen 3D, a unique mid-cap nerve repair product.
However, the challenging macroeconomic scenario, specifically in the Asia Pacific and Europe, is driving higher-than-anticipated inflation in terms of raw materials and labor costs. These could also result in broader economic impacts and security concerns, affecting the company’s business through 2023.
Higher freight costs, ongoing labor inflation and manufacturing and supply-chain inefficiencies continued to put significant pressure on Integra’s margins in recent times. IART’s SG&A expenses rose 12.6% in the third quarter of 2023. In the quarter, the unfavorable product and geographic mix and Boston recall issue-related expenses laid significant pressure on the company’s margins. Our estimates indicate 6.9% and 2.3% increases in SG&A expenses for 2023 and 2024, respectively.
In May 2023, Integra had to voluntarily recall the manufacturing of its key products like PriMatrix, SurgiMend, Revize and TissueMend from its Boston, MA, manufacturing facility. In the second quarter of 2023, the company reported a decline in global revenues, primarily as the result of this recall, which affected both Domestic and International sales.
Further, due to the voluntary recall, the company recorded a $24.1 million write-off of inventory that could no longer be sold. In June, Integra submitted an initial response to the audit findings but currently expects the matter to get resolved not before 2023 end.
Over the past year, shares of IART have declined 27.4% compared with the industry’s 4.7% drop.
Key Picks
Some better-ranked stocks in the broader medical space are Haemonetics (HAE - Free Report) , DexCom (DXCM - Free Report) and Insulet (PODD - Free Report) . Haemonetics and DexCom each presently carry a Zacks Rank #2 (Buy), and Insulet sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Haemonetics’ stock has decreased 0.5% in the past year. Earnings estimates for Haemonetics have increased from $3.82 to $3.89 in 2023 and $4.07 to $4.15 in 2024 in the past 30 days.
HAE’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 16.1%. In the last reported quarter, it posted an earnings surprise of 5.3%.
Estimates for DexCom’s 2023 earnings per share have increased from $1.39 to $1.43 in the past 30 days. Shares of the company have increased 0.1% in the past year compared with the industry’s decline of 4.7%.
DXCM’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 36.4%. In the last reported quarter, it delivered an average earnings surprise of 47.1%.
Estimates for Insulet’s 2023 earnings per share have increased from $1.61 to $1.91 in the past 30 days. Shares of the company have dropped 36.5% in the past year compared with the industry’s decline of 3.3%.
PODD’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 105.1%. In the last reported quarter, it delivered an average earnings surprise of 77.4%.