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Stryker (SYK) to Report Q1 Earnings: What's in the Offing?
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Stryker Corporation (SYK - Free Report) is scheduled to release first-quarter 2020 results on Apr 30 after the closing bell. In the last reported quarter, the company delivered a positive earnings surprise of 1.2%. Further, it has a trailing four-quarter positive earnings surprise of 1.5%, on average.
Q1 Estimates
The Zacks Consensus Estimate for first-quarter earnings per share is pegged at $1.85, indicating a decline of 1.6% from the year-ago quarter.
The same for revenues stands at $3.57 billion, suggesting growth of 1.7% from the prior-year quarter.
MedSurg in Focus
This segment comprises surgical instruments plus endoscopic and emergency medical equipment. Notably, it has been consistently driving Stryker’s top line.
The Zacks Consensus Estimate for the segment’s first-quarter revenues stands at $1.64 billion, suggesting an improvement of 6.4% year-ago reported figure.
MedSurg has three subsegments — Endoscopy, Instruments and Medical.
Growth across its aforementioned three subsegments is likely to have benefited MedSurg’s first-quarter performance. The segment is anticipated to have witnessed considerable worldwide organic growth in the to-be-reported quarter driven by instruments.
Other Factors to Note
The company’s first-quarter performance is likely to reflect broad-based strength across its divisions and regions. In fact, robust performance in emerging markets (except China) and Europe for the first two months of the to-be-reported quarter is likely to get reflected in the company’s results. However, with the coronavirus outbreak intensifying around late February is likely to have affected the same.
Stryker’s Orthopaedics segment is likely to have witnessed strong organic growth on the back of solid performance at the Knee and Hips sub segments during the first two months of the quarter to be reported. However, the pandemic had an adverse impact on elective procedures since late February, which in turn might have weighed on the segment’s overall performance.
Sustained strong demand for Mako TKA (Total Knee Arthoplasty) platform or cementless knee and other 3D printed products for the first two months of the quarter is anticipated to get reflected in the segment’s first-quarter performance. Although it is important to note here that with the elective procedures taking a hit due to the coronavirus impact (since late February), the company is likely to have witnessed decline in the demand for Mako TKA. This, in turn, might have weighed on the company’s performance in the to-be-reported quarter.
With respect to Neurotechnology & Spine segment, a bankable performance within the NeuroTech and Interventional Spine businesses is likely to have contributed to the company’s first-quarter performance. For the upcoming quarterly announcement, the Zacks Consensus Estimate for the segment’s sales stands at $779 million, suggesting growth of 7.9% from the year-ago reported figure.
During fourth-quarter 2019, the company acquired Mobius Imaging — a leader in point-of-care imaging technology — along with its sister company Cardan Robotics in an all-cash transaction for $370 million upfront and up to $130 million of contingent payments related to development and commercial milestones. This transaction is likely to have aided Stryker Spine foray into the intra-operative Imaging segment apart from aligning with Stryker's implant and navigation offering. We expect this development to have positively impacted the company’s first-quarter performance.
However, unfavorable pricing is likely to have affected Stryker’s first-quarter top line. Moreover, high debt might have put pressure on the margins.
What Our Quantitative Model Suggests
Per our proven model, 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.
Earnings ESP: Stryker has an Earnings ESP of -3.29%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Stryker carries a Zacks Rank #4 (Sell).
Stocks Worth a Look
Here are a few medical stocks worth considering as they have the right combination of elements to post an earnings beat this quarter.
Haemonetics Corporation (HAE - Free Report) has an Earnings ESP of +2.76% and a Zacks Rank of 3.
DexCom, Inc. (DXCM - Free Report) has an Earnings ESP of +139.12% and a Zacks Rank of 2.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.1% per year.
Image: Bigstock
Stryker (SYK) to Report Q1 Earnings: What's in the Offing?
Stryker Corporation (SYK - Free Report) is scheduled to release first-quarter 2020 results on Apr 30 after the closing bell. In the last reported quarter, the company delivered a positive earnings surprise of 1.2%. Further, it has a trailing four-quarter positive earnings surprise of 1.5%, on average.
Q1 Estimates
The Zacks Consensus Estimate for first-quarter earnings per share is pegged at $1.85, indicating a decline of 1.6% from the year-ago quarter.
The same for revenues stands at $3.57 billion, suggesting growth of 1.7% from the prior-year quarter.
MedSurg in Focus
This segment comprises surgical instruments plus endoscopic and emergency medical equipment. Notably, it has been consistently driving Stryker’s top line.
The Zacks Consensus Estimate for the segment’s first-quarter revenues stands at $1.64 billion, suggesting an improvement of 6.4% year-ago reported figure.
Stryker Corporation Price and EPS Surprise
Stryker Corporation price-eps-surprise | Stryker Corporation Quote
MedSurg has three subsegments — Endoscopy, Instruments and Medical.
Growth across its aforementioned three subsegments is likely to have benefited MedSurg’s first-quarter performance. The segment is anticipated to have witnessed considerable worldwide organic growth in the to-be-reported quarter driven by instruments.
Other Factors to Note
The company’s first-quarter performance is likely to reflect broad-based strength across its divisions and regions. In fact, robust performance in emerging markets (except China) and Europe for the first two months of the to-be-reported quarter is likely to get reflected in the company’s results. However, with the coronavirus outbreak intensifying around late February is likely to have affected the same.
Stryker’s Orthopaedics segment is likely to have witnessed strong organic growth on the back of solid performance at the Knee and Hips sub segments during the first two months of the quarter to be reported. However, the pandemic had an adverse impact on elective procedures since late February, which in turn might have weighed on the segment’s overall performance.
Sustained strong demand for Mako TKA (Total Knee Arthoplasty) platform or cementless knee and other 3D printed products for the first two months of the quarter is anticipated to get reflected in the segment’s first-quarter performance. Although it is important to note here that with the elective procedures taking a hit due to the coronavirus impact (since late February), the company is likely to have witnessed decline in the demand for Mako TKA. This, in turn, might have weighed on the company’s performance in the to-be-reported quarter.
With respect to Neurotechnology & Spine segment, a bankable performance within the NeuroTech and Interventional Spine businesses is likely to have contributed to the company’s first-quarter performance. For the upcoming quarterly announcement, the Zacks Consensus Estimate for the segment’s sales stands at $779 million, suggesting growth of 7.9% from the year-ago reported figure.
During fourth-quarter 2019, the company acquired Mobius Imaging — a leader in point-of-care imaging technology — along with its sister company Cardan Robotics in an all-cash transaction for $370 million upfront and up to $130 million of contingent payments related to development and commercial milestones. This transaction is likely to have aided Stryker Spine foray into the intra-operative Imaging segment apart from aligning with Stryker's implant and navigation offering. We expect this development to have positively impacted the company’s first-quarter performance.
However, unfavorable pricing is likely to have affected Stryker’s first-quarter top line. Moreover, high debt might have put pressure on the margins.
What Our Quantitative Model Suggests
Per our proven model, 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.
Earnings ESP: Stryker has an Earnings ESP of -3.29%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Stryker carries a Zacks Rank #4 (Sell).
Stocks Worth a Look
Here are a few medical stocks worth considering as they have the right combination of elements to post an earnings beat this quarter.
Chemed Corporation (CHE - Free Report) has an Earnings ESP of +0.42% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Haemonetics Corporation (HAE - Free Report) has an Earnings ESP of +2.76% and a Zacks Rank of 3.
DexCom, Inc. (DXCM - Free Report) has an Earnings ESP of +139.12% and a Zacks Rank of 2.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.1% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>