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Here's Why You Should Retain Integer Holdings Stock in Your Portfolio Now
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Integer Holdings Corporation (ITGR - Free Report) has been gaining from its research and product development activities. The optimism, led by a solid second-quarter 2024 performance and its solid foothold in the broader MedTech space, is expected to contribute further. However, healthcare industry regulations and dependence on third-party suppliers are setbacks.
This Zacks Rank #3 (Hold) company’s shares have risen 29.6% year to date compared with the industry’s 9.3% rise and the S&P 500’s 18.1% growth.
The renowned medical device outsourcing manufacturer has a market capitalization of $4.23 billion. The company projects 12.9% growth for the next five years and expects to maintain its strong performance going forward. Integer Holdings’ earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 7.83%.
Image Source: Zacks Investment Research
Let’s delve deeper.
Upsides
Research and Product Development: Investors have a positive outlook on Integer Holdings, recognizing its strong role in developing and manufacturing medical devices and components. The company is dedicated to creating new products, refining and enhancing existing ones, and exploring new or related applications for its products.
Beyond its internal efforts to advance technology and capabilities, Integer Holdings collaborates with external research institutions on unique technology projects to offer innovative solutions to its customers.
Solid Foothold in the Broader MedTech Space: Investors are optimistic about Integer Holdings’ stable footing in the cardiac, neuromodulation, orthopedics, vascular and advanced surgical markets. The company’s primary customers include large, multi-national original equipment manufacturers and their affiliated subsidiaries.
ITGR is focused on sales efforts to increase its market penetration in the Cardio & Vascular, Neuromodulation and Non-Medical Electrochem markets. The company is undertaking strategic initiatives to maintain its leadership position in the cardiac rhythm management market. Integer Holdings continued to benefit from strong demand across all markets and the addition of new products with InNeuroCo and Pulse acquisitions. These also look promising for the stock.
Strong Q2 Results: Integer Holdings’ robust second-quarter 2024 results raise optimism. The company registered year-over-year top and bottom-line growth. The Medical segment recorded robust results owing to the strength of its product lines. ITGR generated a gross profit of $119.4 million, up 12.8% year over year. The gross margin in the reported quarter expanded 92 basis points (bps) to 27.4%. Adjusted operating profit totaled $56.2 million, reflecting a 30.3% uptick from the prior-year quarter. Adjusted operating margin expanded 211 bps to 12.9%.
Downsides
Healthcare Industry Regulations: Several of Integer Holdings’ product lines are subject to international, federal, state and local health and safety, packaging and product content regulations, including the European Medical Device Regulation that went into effect in May 2021 and was adopted by the European Union as a common legal framework for all member states. Additionally, medical devices are subject to regulations by the FDA and similar agencies. This may result in higher-than-anticipated costs or lower-than-anticipated revenues.
Dependence on Third-Party Suppliers: Integer Holdings’ business depends on a continuous supply of raw materials, which may be susceptible to fluctuations due to transportation issues, government regulations and price controls, among others. Significant increases in the cost of raw materials, which cannot be recovered through increases in the prices of the company’s products, could adversely impact its operational results.
Estimate Trend
Integer Holdings is witnessing a negative estimate revision trend for 2024. In the past 60 days, the Zacks Consensus Estimate for earnings has moved 0.8% north to $5.27 per share.
The Zacks Consensus Estimate for the company’s third-quarter 2024 revenues is pegged at $444.6 million, indicating a 9.9% rise from the year-ago quarter’s reported number. Earnings estimates of $1.36 per share reflect 7.1% growth from the year-earlier level.
A few better-ranked stocks in the broader medical space are DaVita Inc. (DVA - Free Report) , Baxter International Inc. (BAX - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
DVA’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 24.2%. Its shares have risen 55.7% compared with the industry’s 18.5% growth year to date.
Baxter, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 10%. BAX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.7%.
Baxter has gained 1.9% compared with the industry’s 14.7% growth year to date.
Boston Scientific, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 12.6%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.2%.
Boston Scientific’s shares have rallied 42.9% compared with the industry’s 14.7% growth year to date.
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Here's Why You Should Retain Integer Holdings Stock in Your Portfolio Now
Integer Holdings Corporation (ITGR - Free Report) has been gaining from its research and product development activities. The optimism, led by a solid second-quarter 2024 performance and its solid foothold in the broader MedTech space, is expected to contribute further. However, healthcare industry regulations and dependence on third-party suppliers are setbacks.
This Zacks Rank #3 (Hold) company’s shares have risen 29.6% year to date compared with the industry’s 9.3% rise and the S&P 500’s 18.1% growth.
The renowned medical device outsourcing manufacturer has a market capitalization of $4.23 billion. The company projects 12.9% growth for the next five years and expects to maintain its strong performance going forward. Integer Holdings’ earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 7.83%.
Image Source: Zacks Investment Research
Let’s delve deeper.
Upsides
Research and Product Development: Investors have a positive outlook on Integer Holdings, recognizing its strong role in developing and manufacturing medical devices and components. The company is dedicated to creating new products, refining and enhancing existing ones, and exploring new or related applications for its products.
Beyond its internal efforts to advance technology and capabilities, Integer Holdings collaborates with external research institutions on unique technology projects to offer innovative solutions to its customers.
Solid Foothold in the Broader MedTech Space: Investors are optimistic about Integer Holdings’ stable footing in the cardiac, neuromodulation, orthopedics, vascular and advanced surgical markets. The company’s primary customers include large, multi-national original equipment manufacturers and their affiliated subsidiaries.
ITGR is focused on sales efforts to increase its market penetration in the Cardio & Vascular, Neuromodulation and Non-Medical Electrochem markets. The company is undertaking strategic initiatives to maintain its leadership position in the cardiac rhythm management market. Integer Holdings continued to benefit from strong demand across all markets and the addition of new products with InNeuroCo and Pulse acquisitions. These also look promising for the stock.
Strong Q2 Results: Integer Holdings’ robust second-quarter 2024 results raise optimism. The company registered year-over-year top and bottom-line growth. The Medical segment recorded robust results owing to the strength of its product lines. ITGR generated a gross profit of $119.4 million, up 12.8% year over year. The gross margin in the reported quarter expanded 92 basis points (bps) to 27.4%. Adjusted operating profit totaled $56.2 million, reflecting a 30.3% uptick from the prior-year quarter. Adjusted operating margin expanded 211 bps to 12.9%.
Downsides
Healthcare Industry Regulations: Several of Integer Holdings’ product lines are subject to international, federal, state and local health and safety, packaging and product content regulations, including the European Medical Device Regulation that went into effect in May 2021 and was adopted by the European Union as a common legal framework for all member states. Additionally, medical devices are subject to regulations by the FDA and similar agencies. This may result in higher-than-anticipated costs or lower-than-anticipated revenues.
Dependence on Third-Party Suppliers: Integer Holdings’ business depends on a continuous supply of raw materials, which may be susceptible to fluctuations due to transportation issues, government regulations and price controls, among others. Significant increases in the cost of raw materials, which cannot be recovered through increases in the prices of the company’s products, could adversely impact its operational results.
Estimate Trend
Integer Holdings is witnessing a negative estimate revision trend for 2024. In the past 60 days, the Zacks Consensus Estimate for earnings has moved 0.8% north to $5.27 per share.
The Zacks Consensus Estimate for the company’s third-quarter 2024 revenues is pegged at $444.6 million, indicating a 9.9% rise from the year-ago quarter’s reported number. Earnings estimates of $1.36 per share reflect 7.1% growth from the year-earlier level.
Integer Holdings Corporation Price
Integer Holdings Corporation price | Integer Holdings Corporation Quote
Stocks to Consider
A few better-ranked stocks in the broader medical space are DaVita Inc. (DVA - Free Report) , Baxter International Inc. (BAX - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
DaVita, flaunting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 17.5%. You can see the complete list of today’s Zacks #1 Rank stocks here.
DVA’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 24.2%. Its shares have risen 55.7% compared with the industry’s 18.5% growth year to date.
Baxter, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 10%. BAX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.7%.
Baxter has gained 1.9% compared with the industry’s 14.7% growth year to date.
Boston Scientific, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 12.6%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.2%.
Boston Scientific’s shares have rallied 42.9% compared with the industry’s 14.7% growth year to date.