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Integra LifeSciences' Organic Growth Strong on New Products

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On Jun 7, we issued an updated research report on Integra LifeSciences Holdings Corporation (IART - Free Report) . The company has been noticing certain major developments overseas. However, a tough competitive landscape is a concern.

This New Jersey-based company is a leading developer, manufacturer and marketer of surgical implants and medical instruments for use in neurosurgery, extremity reconstruction, orthopedics and general surgery.

Shares of this Zacks Rank #3 (Hold) company have outperformed its industry on a year-to-date basis. The stock has rallied 9.2% compared with the industry’s 3.6% rise.

Integra LifeSciences exited the first quarter of 2019 with a strong organic revenue performance. Within Orthopedics business, organic growth was generated one quarter ahead of schedule, banking on an improved sales force effectiveness, product introductions and double-digit growth in both ankle and shoulder product lines.

Benefiting from product launches and an enhanced sales force performance, the company expects faster organic growth during the second half of 2019. Within Codman Specialty Surgical segment, it is currently working on the introduction of seven products including an intracranial pressure monitor called CereLink.

In this segment, the company realigned 100% of in-patient wound reconstruction and orthopedic territories as part of its channel extension strategy. At the end of the first quarter of this year, Integra LifeSciences noted that the operating performance of each franchise was in line or slightly better than the management’s expectations. Per Integra LifeSciences’ strategic planning, it is now running the entire Codman Specialty Surgical business, independently across the United States, Canada, Australia, New Zealand and China.

Meanwhile, the company faces severe competition in the surgical implants and medical instruments market. It needs consistent innovation to deflect rivalry. Moreover, consolidations in the industry could induce an intense pricing pressure.

Key Picks

Some better-ranked stocks in the broader medical space are

Cerner Corporation , Penumbra (PEN - Free Report) and Bruker Corporation (BRKR - Free Report) . While Cerner sports a Zacks Rank #1 (Strong Buy), Penumbra and Bruker carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Cerner’s long-term earnings growth rate is expected to be 13.5%.

Penumbra’s long-term earnings growth rate is projected at 21.5%.

Bruker’s long-term earnings growth rate is estimated at 11.7%.

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