Yahoo Finance Ongoing Procedural Growth May Aid Stryker's (SYK) Q1 Earnings
Stryker Corporation SYK is scheduled to release first-quarter 2024 results on Apr 30, after market close. In the last reported quarter, the company delivered an earnings surprise of 5.81%.
Q1 Estimates
The Zacks Consensus Estimate for earnings is pegged at $2.35 per share, indicating an increase of 9.8% year over year.
The consensus mark for revenues is pinned at $5.06 billion, implying growth of 5.8% from the prior-year quarter’s reported figure.
Factors to Note
Stryker's MedSurg and Neurotechnology segment witnessed substantial sales growth on the back of the robust performance of subsegments in the past two quarters. Strong performances in the United States, Canada, Australia, Europe, Japan and most emerging markets also boosted revenues. This trend is likely to have continued in the first quarter.
Growth across Orthopaedics & Spine’s Hip, Knee, and Trauma and Extremities subsegments might have favored the segment's performance on the back of continued procedural growth, strong uptake of the Insignia Hip Stem and robust Mako sales.
Stryker is committed to the sustained expansion of Mako, reflecting robust demand for this differentiated robotic technology. This heightened demand, along with rising installations, is likely to have contributed to the Orthopaedics & Spine segment's performance in the soon-to-be-reported quarter. Moreover, an improving hospital budget is likely to have kept the order book strong.
SYK witnessed a very strong momentum for its 1788 camera system during the fourth quarter, following its launch in September 2023. The strong initial uptake is likely to have continued in the soon-to-be-reported quarter, thereby driving additional revenues.
The Zacks Consensus Estimate for the MedSurg and Neurotechnology, and the Orthopaedics & Spine segments’ sales is pegged at $2.87 billion and $2.17 billion, respectively, for the first quarter. U.S. sales are estimated to be $3.76 billion during the same period, while international sales are likely to be $1.32 billion.
The company’s prospects in 2024 seem promising on the back of ongoing procedural recovery, a strong order book for capital equipment, and an improvement in price, along with a strong pipeline of innovation. However, ongoing pressure in China due to volume-based procurement policy is likely to have partially offset international growth.
Stryker is working toward alleviating the ongoing inflationary pressure. The company continues to recognize improved pricing and reduced cost pressure in the past couple of quarters. This is likely to have benefited gross margin during the first quarter.
The company is also looking to expand its presence in the market through acquisitions. In March, it completed the acquisition of SERF SAS, a France-based joint replacement company from Menix. This acquisition will likely expand Stryker's patient base by enhancing its worldwide joint replacement portfolio and augmenting its current position in France and throughout Europe. The company may provide its integration plans for SERF SAS on its first quarter earnings call.
Stryker Corporation Price and EPS Surprise
Stryker Corporation price-eps-surprise | Stryker Corporation Quote
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Stryker this time around. 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 below.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate is -0.78% for SYK at present. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Zacks Rank: The company carries a Zacks Rank #3 at present.
Stocks Worth a Look
Here are some medical stocks worth considering as these have the right combination of elements to post an earnings beat this reporting cycle.
Edwards Lifesciences EW has an Earnings ESP of +1.02% and a Zacks Rank of 3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The company’s shares have surged 12.7% year to date. EW’s earnings met estimates in the last reported quarter. Edwards Lifesciences has a trailing four-quarter average earnings surprise of 0.80%.
SiBone SIBN has an Earnings ESP of +0.69% and a Zacks Rank of 3 at present.
Its shares have lost 26.6% year to date. SIBN’s earnings beat estimates in the last reported quarter. SiBone has a trailing four-quarter average earnings surprise of 19.98%.
Cardinal Health CAH has an Earnings ESP of +1.11% and a Zacks Rank of 3 at present.
The stock has risen 7.4% year to date. CAH’s earnings beat estimates in the last reported quarter. Cardinal Health has a trailing four-quarter average earnings surprise of 15.64%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Stryker Corporation (SYK) : Free Stock Analysis Report
Cardinal Health, Inc. (CAH) : Free Stock Analysis Report
Edwards Lifesciences Corporation (EW) : Free Stock Analysis Report
SiBone (SIBN) : Free Stock Analysis Report
