Orthofix Medical Inc. OFIX reported fourth-quarter 2019 adjusted earnings per share (EPS) of 51 cents, down 8.9% year over year but in line with Zacks Consensus Estimate.
Reported EPS in the quarter came in at 60 cents, showing a year-over-year rise of 30.4%.
For 2019, adjusted EPS came in at $1.47, down 18.8% from the year-ago figure.
Revenues in the fourth quarter came in at $121.5 million, up 0.3% year over year and 0.9% at constant exchange rate or CER. The figure missed the Zacks Consensus Estimate by 1.2%.
For 2019, revenues totaled $460 million, up 1.5% (up 2.6% at CER) from the year- ago period.
The company’s key operating segment Global Spine comprises product lines like Bone Growth Therapies, Spinal Implants, Biologics. For the quarter under review, revenues from Bone Growth Therapies totaled $50.9 million, down 3.5% year over year on a reported and CER basis.
Spinal implant revenues totaled $25.5 million, up 2% (up 2.3% at CER) year over year. Biologics recorded revenues of $16.7 million, up 4.2%, both on a reported and CER basis.
Revenues from Global Extremities grossed $28.3 million, up 4.1% on a reported basis (up 6.4% at CER).
In the fourth quarter of 2019, gross profit fell 0.2% year over year to $95.3 million. However, gross margin contracted 39 basis points (bps) to 78.4%. Adjusted operating profit declined 51.4% from the year-ago quarter to $0.6 million. As a result, adjusted operating margin contracted 564 bps to 5.3%.
Orthofix exited 2019 with cash, cash equivalents, and restricted cash of $70.4 million compared with $72.2 million at the end of the year-ago period. Cumulative cash flow from operating activities at 2019-end totaled $32 million, compared with the year-ago $49.9 million. Capital expenditures totaled $20.5 million at the end of 2019, compared with $15.3 million a year ago.
Guidance for 2020
Orthofix initiated its 2020 guidance. Revenues are projected in the band of $467-477 million. The Zacks Consensus Estimate for the same is pegged at $476.7 million. For 2020, the company’s adjusted EPS is estimated in the range of $1-1.10. The Zacks Consensus Estimate is pegged at $1.73.
For first-quarter 2020, revenues are projected in the band of $106-109 million. The Zacks Consensus Estimate for the metric is pegged at $112.3 million. The company’s adjusted EPS is projected in the band of 9-12 cents. The Zacks Consensus Estimate for the same is at 29 cents.
Orthofix ended the fourth quarter of 2019 on a mixed note. We are upbeat about majority of the key operating segments witnessing year-over-year revenue growth. On a positive note, the recent FDA approval of the Bone Growth Therapy patient monitoring app STIM onTrack 2.1 buoys optimism. However, a decline in Bone Growth Therapies revenues and contraction in both the margins are concerning.
Orthofix currently has a Zacks Rank of 3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings of Other MedTech Majors at a Glance
Some better-ranked stocks, which reported solid results this earnings season, are Stryker Corporation SYK, Accuray Incorporated ARAY and AmerisourceBergen ABC.
Stryker delivered fourth-quarter 2019 adjusted EPS of $2.49, outpacing the Zacks Consensus Estimate by 1.2%. Revenues of $4.13 billion surpassed the consensus mark by 0.7%. The company carries a Zacks Rank #2 (Buy).
Accuray reported third-quarter fiscal 2020 adjusted EPS of a penny versus the Zacks Consensus Estimate of a loss of 7 cents. Net revenues of $98.8 million outpaced the Zacks Consensus Estimate by 0.3%. The company sports a Zacks Rank #1.
AmerisourceBergen reported first-quarter fiscal 2020 adjusted EPS of $1.76, which beat the consensus mark of $1.67 by 5.4%. The company, carrying a Zacks Rank #2, has an expected long-term earnings growth rate of 7.4%.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2020 today >>