More than 84.6% of the S&P 500 members (423 companies) have reported their numbers already, as per the latest Earnings Preview. The trend so far displays an improvement in earnings. As this reporting cycle wraps up, we are confident about this quarter recording earnings growth after five consecutive quarters of decline for the S&P 500 index.
Total earnings for these 423 companies are up 3.6% year over year on 2.4% higher revenues, with 72.8% beating earnings estimates and 55.1% exceeding top-line expectations. As per the report, Medical is one of the 12 broader sectors among the 16 Zacks sectors that have reported earnings growth so far. The sector has witnessed 6.4% earnings growth on the back of 7.4% higher revenues in the third quarter.
What’s in Store for the Med-Product Space?
Medical product, a niche area under the medical device subcategory within the broader Medical sector, holds considerable promise owing to the temporary two-year suspension of the controversial 2.3% medical device excise tax. In addition, the recent change in consumer demand and market dynamics led to a transformation in the entire healthcare system. This is evident from the growing prevalence of minimally invasive surgeries, rising demand for liquid biopsy tests, use of IT for ensuring quick and improved patient care, and the shift of the payment system to a value-based model, among others.
Let’s take a look at the major Medical Product stocks slated to release their third-quarter results on Nov 9:
ICU Medical, Inc. (ICUI - Free Report) is medical device provider catering to infusion therapy, oncology, and critical care applications worldwide. The trailing 12-month average surprise is a negative 0.27%. . In the last reported quarter, the company registered an earnings beat of 10.11%. As per our model, a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to beat estimates. So, we cannot predict an earnings beat for ICU Medical as it has a favorable Zacks Rank #3 but a 0.00% Earnings ESP. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Eagle Pharmaceuticals Inc. is a specialty pharmaceutical company working on injectable products primarily catering to the critical care and oncology areas. Last quarter, the company reported a positive earnings surprise of 17.65%. For the upcoming result, the company has an Earnings ESP of 0.00% because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 71 cents per share. This makes surprise prediction difficult even though Eagle Pharmaceuticals carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Accelerate Diagnostics, Inc. (AXDX - Free Report) is a U.S.-based vitro diagnostics company that provides solutions for the diagnosis of serious infections. We cannot predict an earnings beat for the company as it has an Earnings ESP of -0.34% and a Zacks Rank #3. We also note that in the last reported quarter, the company missed on earnings by 9.38%.
ZELTIQ Aesthetics, Inc. is a medical technology company that develops and markets non-invasive products for the selective reduction of fat. It carries a Zacks Rank #2. However, ZELTIQ has an Earnings ESP of 0.00% which makes surprise prediction difficult. Also, last quarter, the company posted a negative earnings surprise of 71.43%.
Phibro Animal Health Corporation (PAHC - Free Report) is a leading global diversified animal health and mineral nutrition player. While a favorable Zacks Rank #3 increases the predictive power of the ESP, a 0.00% ESP makes a surprise prediction difficult. We also note that in the last reported quarter, the company registered an earnings beat of 5.26%. The trailing 12-month average surprise is a negative 2.19%.
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