We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Integer Holdings (ITGR) Q2 Earnings Top Estimates, Margins Up
Read MoreHide Full Article
Integer Holdings Corporation (ITGR - Free Report) delivered adjusted earnings per share (EPS) of $1.30 in the second quarter of 2024, which improved 14% year over year. The figure topped the Zacks Consensus Estimate by 4.8%.
The adjustments include expenses related to the amortization of intangible assets and restructuring and restructuring-related charges, among others.
GAAP EPS for the quarter was 88 cents, reflecting an improvement of 23.9% year over year.
Revenues in Detail
Integer Holdings registered revenues of $436.2 million in the second quarter, up 9% year over year. The figure missed the Zacks Consensus Estimate by 0.4%.
Organically, revenues increased 5.2%.
Robust Medical sales drove the company’s top line in the reported period.
Segmental Analysis
Integer Holdings operates through two segments — Medical Sales and Non-Medical Sales.
Medical Sales reported revenues of $427.4 million, up 9.8% year over year on a reported and 5.9% on an organic basis. This figure compares to our Medical Sales second-quarter projection of $430 million.
Medical Sales has three product lines — Advanced Surgical, Orthopedics & Portable Medical (AS&O); Cardio and Vascular (C&V); and Cardiac Rhythm Management & Neuromodulation (CRM&N).
Integer Holdings’ AS&O revenues amounted to $28.4 million, up 4.4% year over year on a reported and 5.5% on an organic basis. Per management, this resulted from growth in Advanced Surgical and Orthopedics. This compares to our second-quarter projection of $24 million for AS&O revenues.
Revenues of the C&V business totaled $231.3 million, up 10.9% from the prior-year quarter on a reported basis and up 4.2% organically. The solid year-over-year performance was driven by new product ramps in electrophysiology and structural heart, and the InNeuroCo and Pulse acquisitions. This compares to our second-quarter projection of $230.8 million.
Revenues of the CRM&N business were $167.6 million, up 9.3% year over year on a reported and 8.3% on an organic basis. The solid year-over-year performance was driven by strong growth in emerging neuromodulation customers with PMA (pre-market approval) products. This compares to our second-quarter projection of $175.2 million for the product line.
Revenues in the Non-Medical segment totaled $8.8 million, down 19.3% year over year both on a reported and organic basis. This was due to Electrochem sales returning to a normalized run rate after previously higher sales from the supply-chain recovery. This figure compares to our segmental projection of $7.1 million for the second quarter.
Integer Holdings Corporation Price, Consensus and EPS Surprise
Integer Holdings generated a gross profit of $119.4 million in the second quarter, up 12.8% year over year. The gross margin in the reported quarter expanded 92 basis points (bps) to 27.4%.
We had projected 26.9% of gross margin for the second quarter.
Selling, general and administrative expenses were $47.1 million, up 2.8% year over year. Research, development and engineering costs were $16.1 million in the quarter, down 4.6% year over year. Adjusted operating expenses of $63.2 million increased 0.8% year over year.
Adjusted operating profit totaled $56.2 million, reflecting a 30.3% uptick from the prior-year quarter. Adjusted operating margin in the second quarter expanded 211 bps to 12.9%.
Financial Position
Integer Holdings exited the second quarter of 2024 with cash and cash equivalents of $34.1 million compared with $42.2 million at the first-quarter end. Total debt (including the current portion) at the end of second-quarter 2024 was $1.12 billion compared with $1.14 billion at the first-quarter end.
Cumulative net cash flow from operating activities at the end of second-quarter 2024 was $70.5 million compared with $62.3 million a year ago.
2024 Guidance
Integer Holdings has revised its financial outlook for 2024.
For 2024, the company continues to expect revenues in the range of $1,735 million-$1,770 million (implying an improvement of 9-11% from the 2023 reported figure). The Zacks Consensus Estimate is pegged at $1.76 billion.
The company now expects full-year adjusted EPS in the band of $5.07-$5.49 (indicating a rise of 9-18% from the 2023 reported figure), up from the prior projection of $5.01-$5.43 (implying a rise of 7-16% from the 2023 reported figure). The Zacks Consensus Estimate is pegged at $5.27.
Our Take
Integer Holdings exited the second quarter of 2024 with better-than-expected earnings. The strong year-over-year top-line and bottom-line performances were impressive. Robust performances by the Medical segment and strength in all the product lines of the Medical segment were encouraging. The expansion of both margins bodes well for the stock.
Integer Holdings continued to benefit from strong demand across all markets and the InNeuroCo and Pulse acquisitions. These also look promising for the stock.
However, Integer Holdings’ revenues in the reported quarter were lower than expected. The continued decline in Non-Medical revenues was also discouraging.
Zacks Rank and Key Picks
Integer Holdings currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Abbott Laboratories (ABT - Free Report) , Quest Diagnostics Incorporated (DGX - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Abbott, carrying a Zacks Rank of 2 (Buy), reported second-quarter 2024 adjusted EPS of $1.14, beating the Zacks Consensus Estimate by 3.6%. Revenues of $10.38 billion outpaced the consensus mark by 0.2%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Abbott has a long-term estimated growth rate of 8.6%. ABT’s earnings surpassed estimates in three of the trailing four quarters and broke even once, the average surprise being 2.3%.
Quest Diagnostics reported second-quarter of 2024 adjusted EPS of $2.35, beating the Zacks Consensus Estimate by 1.7%. Revenues of $2.40 billion surpassed the Zacks Consensus Estimate by 0.5%. It currently carries a Zacks Rank #2.
Quest Diagnostics has a long-term estimated growth rate of 6.2%. DGX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.3%.
Boston Scientific reported second-quarter 2024 adjusted EPS of 62 cents, beating the Zacks Consensus Estimate by 6.9%. Revenues of $4.12 billion surpassed the Zacks Consensus Estimate by 2.5%. It currently carries a Zacks Rank #2.
Boston Scientific has a long-term estimated growth rate of 12.5%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.2%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Integer Holdings (ITGR) Q2 Earnings Top Estimates, Margins Up
Integer Holdings Corporation (ITGR - Free Report) delivered adjusted earnings per share (EPS) of $1.30 in the second quarter of 2024, which improved 14% year over year. The figure topped the Zacks Consensus Estimate by 4.8%.
The adjustments include expenses related to the amortization of intangible assets and restructuring and restructuring-related charges, among others.
GAAP EPS for the quarter was 88 cents, reflecting an improvement of 23.9% year over year.
Revenues in Detail
Integer Holdings registered revenues of $436.2 million in the second quarter, up 9% year over year. The figure missed the Zacks Consensus Estimate by 0.4%.
Organically, revenues increased 5.2%.
Robust Medical sales drove the company’s top line in the reported period.
Segmental Analysis
Integer Holdings operates through two segments — Medical Sales and Non-Medical Sales.
Medical Sales reported revenues of $427.4 million, up 9.8% year over year on a reported and 5.9% on an organic basis. This figure compares to our Medical Sales second-quarter projection of $430 million.
Medical Sales has three product lines — Advanced Surgical, Orthopedics & Portable Medical (AS&O); Cardio and Vascular (C&V); and Cardiac Rhythm Management & Neuromodulation (CRM&N).
Integer Holdings’ AS&O revenues amounted to $28.4 million, up 4.4% year over year on a reported and 5.5% on an organic basis. Per management, this resulted from growth in Advanced Surgical and Orthopedics. This compares to our second-quarter projection of $24 million for AS&O revenues.
Revenues of the C&V business totaled $231.3 million, up 10.9% from the prior-year quarter on a reported basis and up 4.2% organically. The solid year-over-year performance was driven by new product ramps in electrophysiology and structural heart, and the InNeuroCo and Pulse acquisitions. This compares to our second-quarter projection of $230.8 million.
Revenues of the CRM&N business were $167.6 million, up 9.3% year over year on a reported and 8.3% on an organic basis. The solid year-over-year performance was driven by strong growth in emerging neuromodulation customers with PMA (pre-market approval) products. This compares to our second-quarter projection of $175.2 million for the product line.
Revenues in the Non-Medical segment totaled $8.8 million, down 19.3% year over year both on a reported and organic basis. This was due to Electrochem sales returning to a normalized run rate after previously higher sales from the supply-chain recovery. This figure compares to our segmental projection of $7.1 million for the second quarter.
Integer Holdings Corporation Price, Consensus and EPS Surprise
Integer Holdings Corporation price-consensus-eps-surprise-chart | Integer Holdings Corporation Quote
Margin Analysis
Integer Holdings generated a gross profit of $119.4 million in the second quarter, up 12.8% year over year. The gross margin in the reported quarter expanded 92 basis points (bps) to 27.4%.
We had projected 26.9% of gross margin for the second quarter.
Selling, general and administrative expenses were $47.1 million, up 2.8% year over year. Research, development and engineering costs were $16.1 million in the quarter, down 4.6% year over year. Adjusted operating expenses of $63.2 million increased 0.8% year over year.
Adjusted operating profit totaled $56.2 million, reflecting a 30.3% uptick from the prior-year quarter. Adjusted operating margin in the second quarter expanded 211 bps to 12.9%.
Financial Position
Integer Holdings exited the second quarter of 2024 with cash and cash equivalents of $34.1 million compared with $42.2 million at the first-quarter end. Total debt (including the current portion) at the end of second-quarter 2024 was $1.12 billion compared with $1.14 billion at the first-quarter end.
Cumulative net cash flow from operating activities at the end of second-quarter 2024 was $70.5 million compared with $62.3 million a year ago.
2024 Guidance
Integer Holdings has revised its financial outlook for 2024.
For 2024, the company continues to expect revenues in the range of $1,735 million-$1,770 million (implying an improvement of 9-11% from the 2023 reported figure). The Zacks Consensus Estimate is pegged at $1.76 billion.
The company now expects full-year adjusted EPS in the band of $5.07-$5.49 (indicating a rise of 9-18% from the 2023 reported figure), up from the prior projection of $5.01-$5.43 (implying a rise of 7-16% from the 2023 reported figure). The Zacks Consensus Estimate is pegged at $5.27.
Our Take
Integer Holdings exited the second quarter of 2024 with better-than-expected earnings. The strong year-over-year top-line and bottom-line performances were impressive. Robust performances by the Medical segment and strength in all the product lines of the Medical segment were encouraging. The expansion of both margins bodes well for the stock.
Integer Holdings continued to benefit from strong demand across all markets and the InNeuroCo and Pulse acquisitions. These also look promising for the stock.
However, Integer Holdings’ revenues in the reported quarter were lower than expected. The continued decline in Non-Medical revenues was also discouraging.
Zacks Rank and Key Picks
Integer Holdings currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Abbott Laboratories (ABT - Free Report) , Quest Diagnostics Incorporated (DGX - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Abbott, carrying a Zacks Rank of 2 (Buy), reported second-quarter 2024 adjusted EPS of $1.14, beating the Zacks Consensus Estimate by 3.6%. Revenues of $10.38 billion outpaced the consensus mark by 0.2%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Abbott has a long-term estimated growth rate of 8.6%. ABT’s earnings surpassed estimates in three of the trailing four quarters and broke even once, the average surprise being 2.3%.
Quest Diagnostics reported second-quarter of 2024 adjusted EPS of $2.35, beating the Zacks Consensus Estimate by 1.7%. Revenues of $2.40 billion surpassed the Zacks Consensus Estimate by 0.5%. It currently carries a Zacks Rank #2.
Quest Diagnostics has a long-term estimated growth rate of 6.2%. DGX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.3%.
Boston Scientific reported second-quarter 2024 adjusted EPS of 62 cents, beating the Zacks Consensus Estimate by 6.9%. Revenues of $4.12 billion surpassed the Zacks Consensus Estimate by 2.5%. It currently carries a Zacks Rank #2.
Boston Scientific has a long-term estimated growth rate of 12.5%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.2%.