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Integer Holdings (ITGR) Gains 30.5% YTD: What's Driving the Stock?
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Integer Holdings (ITGR - Free Report) witnessed strong momentum year to date. Shares of the company have gained 30.5% against the 0.1% decline of the industry in the same time frame. The S&P 500 Composite has risen 19.6% during the same period.
With healthy fundamentals and strong growth opportunities, this Zacks Rank #4 (Sell) company appears to be a solid wealth creator for its investors at the moment.
Plano, TX-based Integer Holdings manufactures and develops medical devices and components primarily for original equipment manufacturers.
Integer Holdings operates through two segments — Medical Sales and Non-Medical Sales. Medical Sales has three sub-segments — Advanced Surgical, Orthopedics and Portable Medical (AS&O); Cardio and Vascular (C&V); and Cardiac Rhythm Management & Neuromodulation (CRM&N).
Image Source: Zacks Investment Research
Factors Favoring ITGR’s Growth
Integer Holdings is witnessing an upward trend in its stock price, prompted by its execution of manufacturing excellence initiatives, an improved supply chain, and a direct labor environment. The optimism led by a solid second-quarter 2024 performance and its strength in Medical sales are expected to contribute further.
Investors seemed to be optimistic about Integer Holdings’ stable footing in the cardiac, neuromodulation, orthopedics, vascular and advanced surgical markets. In October, ITGR announced that it has entered into an agreement to divest its Electrochem business, which focuses on non-medical applications for the energy, military and environmental sectors, to Ultralife Corporation. Following the divestiture transaction, Integer Holdings is likely to completely focus on its medical business segment with additional cash to pay down debt and execute its inorganic growth strategy.
In September, ITGR announced the completion of its facility expansions in Ireland. This announcement followed the official opening of an 80,000 sq. ft. expansion of Integer Holdings guidewire manufacturing facility in New Ross, County Wexford, Ireland, earlier in September. This expansion in Ireland provides ITGR with the capacity and differentiated capabilities to amplify its customers’ innovation and help them bring products to market faster. Accordingly, investors seemed to be optimistic following this news.
Integer Holdings exited the second quarter of 2024 with better-than-expected results. 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. These factors must have aided in surging the stock’s price.
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 second quarter expanded 92 basis points (bps) to 27.4%. Adjusted operating profit totaled $56.2 million in the second quarter, reflecting a 30.3% uptick from the prior-year quarter. Adjusted operating margin in the second quarter expanded 211 bps to 12.9%. The expansion of both margins bodes well for the stock and has contributed to raising the price of the stock.
Factors That May Offset the Gains for ITGR
Integer Holdings’ business depends on a continuous supply of raw materials. The supply and price of raw materials 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 affect its operating results.
A Look at Estimates
Integer Holdings’earnings per share (EPS) in 2024 and 2025 are expected to increase 13.5% and 14.3% to $5.30 and $6.06 on a year-over-year basis, respectively. The Zacks Consensus Estimate for EPS has decreased 1 cent for 2024 and 2025 in the past 30 days.
Revenues for 2024 and 2025 are anticipated to rise 9.3% and 7.1% to $1.75 billion and $1.88 billion, respectively, on a year-over-year basis.
Inspire Medical’s shares have surged 60.5% in the past year. Estimates for the company’s earnings have moved 5.1% north to $1.65 per share for 2024 in the past 30 days.
ISRG’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 436.2%. In the last reported quarter, it posted an earnings surprise of 328.6%.
Estimates for TransMedics’ 2024 EPS have moved up 125% to 27 cents in the past 30 days. Shares of the company have soared 135.2% in the past year compared with the industry’s 14.9% growth.
TMDX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 287.50%. In the last reported quarter, it delivered an earnings surprise of 66.67%.
Estimates for Boston Scientific’s 2024 EPS have increased 1.7% to $2.40 in the past 30 days. In the past year, shares of BSX have risen 55.5% compared with the industry’s 17.9% growth.
In the last reported quarter, BSX delivered an earnings surprise of 6.90%. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.18%.
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Integer Holdings (ITGR) Gains 30.5% YTD: What's Driving the Stock?
Integer Holdings (ITGR - Free Report) witnessed strong momentum year to date. Shares of the company have gained 30.5% against the 0.1% decline of the industry in the same time frame. The S&P 500 Composite has risen 19.6% during the same period.
With healthy fundamentals and strong growth opportunities, this Zacks Rank #4 (Sell) company appears to be a solid wealth creator for its investors at the moment.
Plano, TX-based Integer Holdings manufactures and develops medical devices and components primarily for original equipment manufacturers.
Integer Holdings operates through two segments — Medical Sales and Non-Medical Sales. Medical Sales has three sub-segments — Advanced Surgical, Orthopedics and Portable Medical (AS&O); Cardio and Vascular (C&V); and Cardiac Rhythm Management & Neuromodulation (CRM&N).
Image Source: Zacks Investment Research
Factors Favoring ITGR’s Growth
Integer Holdings is witnessing an upward trend in its stock price, prompted by its execution of manufacturing excellence initiatives, an improved supply chain, and a direct labor environment. The optimism led by a solid second-quarter 2024 performance and its strength in Medical sales are expected to contribute further.
Investors seemed to be optimistic about Integer Holdings’ stable footing in the cardiac, neuromodulation, orthopedics, vascular and advanced surgical markets. In October, ITGR announced that it has entered into an agreement to divest its Electrochem business, which focuses on non-medical applications for the energy, military and environmental sectors, to Ultralife Corporation. Following the divestiture transaction, Integer Holdings is likely to completely focus on its medical business segment with additional cash to pay down debt and execute its inorganic growth strategy.
In September, ITGR announced the completion of its facility expansions in Ireland. This announcement followed the official opening of an 80,000 sq. ft. expansion of Integer Holdings guidewire manufacturing facility in New Ross, County Wexford, Ireland, earlier in September. This expansion in Ireland provides ITGR with the capacity and differentiated capabilities to amplify its customers’ innovation and help them bring products to market faster. Accordingly, investors seemed to be optimistic following this news.
Integer Holdings exited the second quarter of 2024 with better-than-expected results. 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. These factors must have aided in surging the stock’s price.
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 second quarter expanded 92 basis points (bps) to 27.4%. Adjusted operating profit totaled $56.2 million in the second quarter, reflecting a 30.3% uptick from the prior-year quarter. Adjusted operating margin in the second quarter expanded 211 bps to 12.9%. The expansion of both margins bodes well for the stock and has contributed to raising the price of the stock.
Factors That May Offset the Gains for ITGR
Integer Holdings’ business depends on a continuous supply of raw materials. The supply and price of raw materials 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 affect its operating results.
A Look at Estimates
Integer Holdings’earnings per share (EPS) in 2024 and 2025 are expected to increase 13.5% and 14.3% to $5.30 and $6.06 on a year-over-year basis, respectively. The Zacks Consensus Estimate for EPS has decreased 1 cent for 2024 and 2025 in the past 30 days.
Revenues for 2024 and 2025 are anticipated to rise 9.3% and 7.1% to $1.75 billion and $1.88 billion, respectively, on a year-over-year basis.
Stocks to Consider
Some better-ranked stocks in the broader medical space are Inspire Medical (INSP - Free Report) , TransMedics Group (TMDX - Free Report) and Boston Scientific (BSX - Free Report) . While Intuitive Surgical and TransMedics currently sport a Zacks Rank #1 (Strong Buy), Quest Diagnostics carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Inspire Medical’s shares have surged 60.5% in the past year. Estimates for the company’s earnings have moved 5.1% north to $1.65 per share for 2024 in the past 30 days.
ISRG’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 436.2%. In the last reported quarter, it posted an earnings surprise of 328.6%.
Estimates for TransMedics’ 2024 EPS have moved up 125% to 27 cents in the past 30 days. Shares of the company have soared 135.2% in the past year compared with the industry’s 14.9% growth.
TMDX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 287.50%. In the last reported quarter, it delivered an earnings surprise of 66.67%.
Estimates for Boston Scientific’s 2024 EPS have increased 1.7% to $2.40 in the past 30 days. In the past year, shares of BSX have risen 55.5% compared with the industry’s 17.9% growth.
In the last reported quarter, BSX delivered an earnings surprise of 6.90%. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 7.18%.