It has been about a month since the last earnings report for Avanos Medical (AVNS Quick QuoteAVNS - Free Report) . Shares have added about 1.1% in that time frame, underperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Avanos Medical due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for AVANOS MEDICAL, INC. before we dive into how investors and analysts have reacted as of late.

AVNS Q1 Earnings Miss & Revenue Beat, Margins Down

Avanos Medical reported first-quarter 2026 adjusted earnings per share (EPS) from continuing operations of 22 cents, down 15.4% year over year. The bottom line missed the Zacks Consensus Estimate of 23 cents.

GAAP EPS from continuing operations in the quarter under review was 11 cents compared with the year-ago period’s EPS of 14 cents.

Avanos’ Q1 Revenues

Revenues totaled $182.2 million in the reported quarter, up 8.8% year over year. The metric beat the Zacks Consensus Estimate by 7.6%.

The top line gained from higher volume across its Specialty Nutrition Systems (SNS) segments.

AVNS’ Segmental Analysis

Avanos generates revenues from three segments: SNS, PM&R, and Corporate and Other.

The SNS segment’s revenues in the first quarter of 2026 totaled $124 million, up 22.7% year over year. This figure beat our first-quarter projection of $107 million.

The segment recorded 19% volume growth, driven by continued strong demand across both our enteral feeding and neonate solutions.

The Enteral feeding unit’s revenues totaled $84.6 million for the first quarter of 2026 (up 13.6% year over year), while the Neonate solutions unit’s revenues amounted to $39.4 million (up 48.1% year over year).

The PM&R segment’s revenues totaled $56.3 million, up 0.2% year over year. However, the figure missed our projection of $62 million.

The PM&R segment’s volume growth in Radio Frequency Ablation (RFA) was partially offset by reduced volume in surgical pain and recovery product lines. Net sales of RFA products grew 8.8% year over year to $34.5 million, reflecting momentum in RFA generator sales. Net sales in the surgical pain and recovery unit declined 11% year over year to $21.8 million.

The Corporate and Other segment’s revenues totaled $1.9 million, down 81.4% year over year.

Avanos’ Q1 Margin Analysis

In the quarter under review, Avanos’ adjusted gross profit increased 2.4% year over year to $97.3 million. The adjusted gross margin contracted 330 basis points (bps) to 53.4%. We had projected a gross margin of 54.2% for the first quarter.

Selling and general expenses increased 2.6% year over year to $77.7 million. Research and development expenses decreased 3.7% year over year to $5.2 million. Adjusted operating expenses of $81.1 million increased 4.1% year over year.

Adjusted operating profit totaled $16.2 million, reflecting a 5.3% decrease from the prior-year quarter’s level. The adjusted operating margin contracted 130 bps to 8.9%.

AVNS’ Financial Update

The company exited first-quarter 2026 with cash and cash equivalents worth $65.6 million compared with $89.8 million at the end of 2025. Total debt at first-quarter 2026-end was $98.2 million compared with $100.5 million at the end of 2025.

Net cash used in operating activities at the end of the first quarter of 2026 totaled $12.3 million against the net cash provided by operating activities of $25.7 million in the prior-year period.

Avanos’ 2026 Guidance

AVNS has provided its 2026 sales and earnings outlook.

The company expects full-year 2026 net sales to be in the range of $700-$720 million. The Zacks Consensus Estimate is currently pegged at $702.3 million.

Avanos anticipates 2026 adjusted EPS between 90 cents and $1.10. The Zacks Consensus Estimate is currently pegged at $1.07.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.

VGM Scores

At this time, Avanos Medical has a subpar Growth Score of D, a score with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for value investors.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Avanos Medical has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Avanos Medical is part of the Zacks Medical - Instruments industry. Over the past month, DexCom (DXCM Quick QuoteDXCM - Free Report) , a stock from the same industry, has gained 20.6%. The company reported its results for the quarter ended March 2026 more than a month ago.

DexCom reported revenues of $1.19 billion in the last reported quarter, representing a year-over-year change of +15%. EPS of $0.56 for the same period compares with $0.32 a year ago.

DexCom is expected to post earnings of $0.60 per share for the current quarter, representing a year-over-year change of +25%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.6%.

DexCom has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.