We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Solventum Q1 Earnings Likely to Reflect Higher Costs & Expenses
Read MoreHide Full Article
Solventum (SOLV - Free Report) is scheduled to release first-quarter 2025 results on May 8, after market close. In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 7.63%. SOLV delivered a trailing four-quarter average earnings surprise of 14.47%.
SOLV Q1 Estimates
Currently, the consensus estimate for revenues is pegged at $2 billion. The consensus mark for earnings is pinned at $1.19 per share. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)
Factors to Note
Solventum's first-quarter performance is likely to have been buoyed by the steady execution of its strategic initiatives and ongoing transformation. As the company navigates its first full year post-spin from 3M, management remains focused on business stabilization, restructuring and long-term growth acceleration. The top line is likely to have been driven by the Dental Solutions and Purification and Filtration segments.
The company issued its 2025 outlook on its fourth-quarter earnings call, with organic sales growth expected to be 1-2% and adjusted EPS anticipated to be in the range of $5.45-$5.65. The company also raised its free cash flow forecast to $450-$550 million, reflecting capital expenditures of $350-$450 million as well as higher interest expense and one-time separation expense.
Segmental Performance
Revenue growth in the first quarter is expected to have been driven by the continued adoption of Solventum’s MedSurg portfolio, particularly in antimicrobial IV site management and new product launches like V.A.C. Peel and Place dressing. SOLV recorded 2.3% organic growth during the fourth quarter. Sales in the soon-to-be-reported quarter are also expected to have shown sequential improvement due to increased demand in the Dental segment on the back of recently launched SOLV’s first-to-market 3D printed Clarity Precision Grip attachment, Clinpro Clear Fluoride treatment and Filtek Easy Match.
The company’s Health Information Systems (HIS) segment is likely to have benefited from continued adoption of its revenue cycle management platform, 360 Encompass, although pressure in clinical productivity solutions might have persisted. HIS segment is likely to have seen traction from the AI-powered Revenue Integrity System, designed to enhance hospital reimbursement efficiencies. The Purification and Filtration segment is expected to have experienced sustained growth on the back of strong demand in bioprocessing filtration and industrial applications. However, foreign currency headwinds and the annualization of price normalization are likely to have hurt the revenue growth rate.
During the fourth quarter, gross margin (56.2%) contracted 100 basis points while operating margin was down 550 bps to 20.4%. The pressure on the margin is likely to have continued in the first quarter as well. The continued investment in commercial infrastructure, ERP transitions, and standalone operations following separation from 3M should have further fueled expenses, thereby hurting operating margin.
However, the company’s disciplined approach to cost control, including its restructuring initiative, the Solventum Way, is expected to have offset some of these pressures by driving operational efficiencies and resource reallocation.
In February, SOLV inked a deal with Thermo Fischer to sell its Purification & Filtration business for $4.1 billion, as part of its transformation plan. The deal, which is expected to have no impact on 2025 EPS, is likely to be closed by the end of this year. The company may provide details on the deal during the earnings call.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Baxter this time around. 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: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00% for Baxter.
You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank: Solventum currently has a Zacks Rank #4 (Sell).
Stocks Worth a Look
Here are a few medical stocks worth considering, as these have the right combination of elements to come up with an earnings beat this reporting cycle.
Premier (PINC - Free Report) has an Earnings ESP of +13.82% and a Zacks Rank #2 at present.
PINC’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average surprise being 20.43%. The Zacks Consensus Estimate for fiscal third-quarter EPS implies a decline of 43.6% from the year-ago reported figure.You can see the complete list of today’s Zacks #1 Rank stocks here.
HealthEquity (HQY - Free Report) has an Earnings ESP of +2.03% and a Zacks Rank #3 at present.
HQY’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average surprise being 12.78%. The Zacks Consensus Estimate for fiscal first-quarter EPS implies an improvement of 1.3% from the year-ago reported figure.
Progyny (PGNY - Free Report) has an Earnings ESP of +2.68% and a Zacks Rank #3 at present. The company is scheduled to release first-quarter results on May 8.
PGNY’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 54.91%. The Zacks Consensus Estimate for first-quarter EPS implies an improvement of 15.4% from the year-ago reported figure.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Solventum Q1 Earnings Likely to Reflect Higher Costs & Expenses
Solventum (SOLV - Free Report) is scheduled to release first-quarter 2025 results on May 8, after market close. In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 7.63%. SOLV delivered a trailing four-quarter average earnings surprise of 14.47%.
SOLV Q1 Estimates
Currently, the consensus estimate for revenues is pegged at $2 billion. The consensus mark for earnings is pinned at $1.19 per share. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)
Factors to Note
Solventum's first-quarter performance is likely to have been buoyed by the steady execution of its strategic initiatives and ongoing transformation. As the company navigates its first full year post-spin from 3M, management remains focused on business stabilization, restructuring and long-term growth acceleration. The top line is likely to have been driven by the Dental Solutions and Purification and Filtration segments.
The company issued its 2025 outlook on its fourth-quarter earnings call, with organic sales growth expected to be 1-2% and adjusted EPS anticipated to be in the range of $5.45-$5.65. The company also raised its free cash flow forecast to $450-$550 million, reflecting capital expenditures of $350-$450 million as well as higher interest expense and one-time separation expense.
Segmental Performance
Revenue growth in the first quarter is expected to have been driven by the continued adoption of Solventum’s MedSurg portfolio, particularly in antimicrobial IV site management and new product launches like V.A.C. Peel and Place dressing. SOLV recorded 2.3% organic growth during the fourth quarter. Sales in the soon-to-be-reported quarter are also expected to have shown sequential improvement due to increased demand in the Dental segment on the back of recently launched SOLV’s first-to-market 3D printed Clarity Precision Grip attachment, Clinpro Clear Fluoride treatment and Filtek Easy Match.
The company’s Health Information Systems (HIS) segment is likely to have benefited from continued adoption of its revenue cycle management platform, 360 Encompass, although pressure in clinical productivity solutions might have persisted. HIS segment is likely to have seen traction from the AI-powered Revenue Integrity System, designed to enhance hospital reimbursement efficiencies. The Purification and Filtration segment is expected to have experienced sustained growth on the back of strong demand in bioprocessing filtration and industrial applications. However, foreign currency headwinds and the annualization of price normalization are likely to have hurt the revenue growth rate.
Solventum Corporation Price and EPS Surprise
Solventum Corporation price-eps-surprise | Solventum Corporation Quote
Margins Under Pressure
During the fourth quarter, gross margin (56.2%) contracted 100 basis points while operating margin was down 550 bps to 20.4%. The pressure on the margin is likely to have continued in the first quarter as well. The continued investment in commercial infrastructure, ERP transitions, and standalone operations following separation from 3M should have further fueled expenses, thereby hurting operating margin.
However, the company’s disciplined approach to cost control, including its restructuring initiative, the Solventum Way, is expected to have offset some of these pressures by driving operational efficiencies and resource reallocation.
In February, SOLV inked a deal with Thermo Fischer to sell its Purification & Filtration business for $4.1 billion, as part of its transformation plan. The deal, which is expected to have no impact on 2025 EPS, is likely to be closed by the end of this year. The company may provide details on the deal during the earnings call.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Baxter this time around. 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: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00% for Baxter.
You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Zacks Rank: Solventum currently has a Zacks Rank #4 (Sell).
Stocks Worth a Look
Here are a few medical stocks worth considering, as these have the right combination of elements to come up with an earnings beat this reporting cycle.
Premier (PINC - Free Report) has an Earnings ESP of +13.82% and a Zacks Rank #2 at present.
PINC’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average surprise being 20.43%. The Zacks Consensus Estimate for fiscal third-quarter EPS implies a decline of 43.6% from the year-ago reported figure.You can see the complete list of today’s Zacks #1 Rank stocks here.
HealthEquity (HQY - Free Report) has an Earnings ESP of +2.03% and a Zacks Rank #3 at present.
HQY’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average surprise being 12.78%. The Zacks Consensus Estimate for fiscal first-quarter EPS implies an improvement of 1.3% from the year-ago reported figure.
Progyny (PGNY - Free Report) has an Earnings ESP of +2.68% and a Zacks Rank #3 at present. The company is scheduled to release first-quarter results on May 8.
PGNY’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 54.91%. The Zacks Consensus Estimate for first-quarter EPS implies an improvement of 15.4% from the year-ago reported figure.