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Nevro (NVRO) Q4 Loss Narrower Than Estimated, Revenues Miss

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Nevro Corp (NVRO - Free Report) reported fourth-quarter 2020 loss per share of 21 cents, narrower than the Zacks Consensus Estimate of a loss of 35 cents. The bottom line also compared favorably with the year-ago quarter’s loss per share of 44 cents.

For 2020 too, loss per share narrowed to $2.47 from the Zacks Consensus Estimate of a loss of $2.62 as well as the year-ago quarter’s loss per share of $3.37.

Revenues

Revenues of $109.7 million missed the Zacks Consensus Estimate by 1%. The top line also fell 4.1% year over year.

Meanwhile, for 2020, revenues came in at $362 million, in line with the Zacks Consensus Estimate. The figure, however, fell 7.3% year over year.

Quarterly Highlights

In the quarter under review, international revenues were $15.1 million, down 8% year over year on a reported basis and 14% at constant currency. U.S. revenues for the quarter totaled $94.6 million, down 3% year over year. This downside was due to resurgence of COVID-19 in the latter half of the fourth quarter. 

Margins

Gross profit totaled $78 million, down 3.9% year over year. Gross margin was 71.1%, up 6 basis points (bps).

Total operating expenses fell 15.1% year over year to $78.9 million.

Loss from operations was $0.9 million, narrower than the year-ago quarter’s loss of $11.7 million.

 

Nevro Corp. Price, Consensus and EPS Surprise

Nevro Corp. Price, Consensus and EPS Surprise

 

Nevro Corp. price-consensus-eps-surprise-chart | Nevro Corp. Quote

 

Guidance

Nevro projects first quarter of 2021 global revenues in the range of $84-$86 million. The Zacks Consensus Estimate for the same is pegged at $93.7 million.

For 2021, the company expects total revenues in the range of $430-$450 million. The Zacks Consensus Estimate for the same is pegged at $450.4 million.

Cash Position

The company exited the fourth quarter with cash and cash equivalents of $44.6 million compared with $65.4 million at the end of year ago period.

Summary

Nevro exited the fourth quarter on a mixed note. Reduction in operating expenses is encouraging. Further, the commercial launch of the Senza Omnia SCS System continues to buoy optimism on the stock. Expansion in gross margin is a positive too. The company’s submission of PMA supplement to the FDA in December 2020, seeking an approval for Senza System to treat chronic pain associated with Painful Diabetic Neuropathy (PDN) is another plus.

However, the company saw a decline in both domestic and international revenues during the fourth quarter. In the same period, total U.S. permanent implant procedures fell 1% with trial procedures declining 8% year over year. Also, the company incurred an operating loss in the quarter under review.

Zacks Rank and Key Picks

Nevro currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader medical space that already announced quarterly results are Hologic, Inc. (HOLX - Free Report) , Abbott Laboratories (ABT - Free Report) and AngioDynamics, Inc. (ANGO - Free Report) , each presently carrying a Zacks Rank#2 (Buy).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Hologic reported first-quarter fiscal 2021 adjusted EPS of $2.86, which surpassed the Zacks Consensus Estimate by 33.6%.

Abbott reported fourth-quarter 2020 adjusted EPS of $1.45, which surpassed the Zacks Consensus Estimate by 6.6%. Further, fourth-quarter worldwide sales of $10.7 billion outpaced the consensus mark by 7.9%.

AngioDynamics reported second-quarter fiscal 2021 adjusted EPS of a penny. The Zacks Consensus Estimate was of a loss per share of two cents. Additionally, revenues of $72.8 million beat the consensus mark by 8%.

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