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Here's Why You Should Retain Wright Medical Stock For Now

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Wright Medical Group N.V. is well poised for growth backed by strong international presence, solid prospects in the global orthopedic space, and improved product launches. However, forex continues to remain a concern.

The stock currently carries a Zacks Rank #3 (Hold).

Price Performance

Shares of Wright Medical have lost 22.8%, compared with the industry’s decline of 3.1% in a year’s time. The S&P 500 Index fell 0.2%.



What’s Deterring the Stock?

Forex continues to remain a concern as the company generates a substantial part of its total revenues from international operations. This in turn can be adversely affected by fluctuations in foreign currency exchange rates.

In fact, for 2019, Wright Medical anticipates a 1% headwind related to foreign currency.

What’s Favoring the Stock?

Wright Medical has been gaining from international expansion for quite some time now. In fact, the company’s international net sales are anticipated to improve significantly on the back of continued strong performance in Biologics.

Further, the company has been reaping benefits from improving trends in the global orthopedic space.

Moreover, the company has significant presence in key emerging markets like Asia, which further enhances prospects.

Additionally, the company’s diversified product portfolio has been bolstering its overall performance over a considerable period of time. Notably, the company is likely to gain from the upcoming launch of REVIVE revision shoulder system.

New product launches, which include internally developed products and the ones from acquisitions, have been supporting the company’s top line and we expect this trend to continue in the future.

Notably, robust 2019 outlook instills optimism in the stock.

Which Way are Estimates Headed?

For 2019, the Zacks Consensus Estimate for revenues is pegged at $945.2 million, indicating an improvement of 13% from the year-ago period. The same for earnings stands at 20 cents per share.

Key Picks

Some other better-ranked stocks from the broader medical space are Baxter International Inc. (BAX - Free Report) , Amedisys, Inc. (AMED - Free Report) and HMS Holdings Corp. , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Baxter has a long-term earnings growth rate of 12.8%.

Amedisys has a long-term earnings growth rate of 16.3%.

HMS Holdings has a long-term earnings growth rate 11%.

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