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Cardiovascular Systems (CSII) Swings to Earnings in Q3
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Cardiovascular Systems, Inc. reported adjusted earnings per share of 3 cents in third-quarter fiscal 2017, reflecting a massive improvement from the year-ago quarter’s adjusted loss of 47 cents. The quarter’s number compared favorably with the Zacks Consensus Estimate of a loss of 4 cents.
The year-over-year improvement was primarily backed by revenue growth and lower operating expenses on account of the company’s cost realignment actions.
Quarter in Details
Cardiovascular Systems posted revenues of $52.1 million in the fiscal third quarter, marking a year-over-year increase of 17.3%. The figure surpassed the Zacks Consensus Estimate of $51 million.
Cardiovascular Systems, Inc. Price, Consensus and EPS Surprise
Per management, the strong top-line performance exhibited the company’s efforts to stabilize and support its field sales representatives.
During the reported quarter, Cardiovascular Systems sold over 15,700 devices, which generated 92% of revenues. The company added 37 new peripheral accounts and 35 coronary accounts.
Coronary device revenues improved 28% year over year to $13.5 million and peripheral device revenues rose 14% to $38.7 million.
Margin
Gross margin in the reported quarter was 78.6%, down 174 basis points (bps) year over year, primarily on account of a 27.6% rise in cost of goods sold.
Meanwhile, selling and administrative (SG&A) expenses contracted 11.8% to $37.3 million and research and development (R&D) expenses fell 5.5% to $5.4 million. The resultant adjusted operating expenses declined 11.1% to $42.7 million, primarily exhibiting management’s cost realignment initiatives and timing of studies and projects. Consequently, operating loss narrowed to a loss of $1.7 million from a loss of $12.3 million a year ago.
Financial position
The company exited the third quarter of fiscal 2017 with cash and cash equivalents of $103.1 million, compared with $79.2 million at the end of second-quarter 2017.
Outlook
Cardiovascular Systems issued its fourth-quarter fiscal 2017 guidance. The company expects revenues in the range of $51.5–$52.5 million. The current Zacks Consensus Estimate for fourth-quarter fiscal 2017 revenues is pegged at $52.8 million, slightly above the company’s guidance.
Moreover, the company expects gross profit to account for 81% of revenues, while operating expenses are estimated at around $43.5 million.
The company expects to incur net loss of $2.0–$1.4 million or loss per share of 6–4 cents in the fourth quarter. The current Zacks Consensus Estimate is pegged at a loss of 2 cents, narrower than the company’s guided range.
Our Take
Cardiovascular Systems delivered impressive third-quarter 2017 results. Additionally, the company’s lower operating expenses drove the year-over-year improvement in the earnings figure. Strong revenue performance also contributed to the upside in earnings. Per management, the company delivered improved results demonstrating significant progress in revenue growth, while moving toward positive cash flow and profitability.
Moreover, the company achieved several milestones during the quarter. Its Diamondback 360 coronary micro crown orbital atherectomy system was approved for the treatment of severely calcified coronary artery lesions by the Ministry of Health, Labor and Welfare in Japan and by the U.S. FDA. The six-month favorable data from the LIBERTY 360° trial were also presented at the International Symposium on Endovascular Therapy.
Zacks Rank & Key Picks
Cardiovascular Systems currently has a Zacks Rank #3 (Hold). Better-ranked medical stocks include Hologic, Inc. (HOLX - Free Report) , Baxter International Inc. (BAX - Free Report) and Progenics Pharmaceuticals, Inc. . Hologic and Progenics Pharmaceuticals sport a Zacks Rank 1 (Strong Buy), while Baxter International carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Hologic gained 33.6% in the last one year, in comparison to the S&P 500’s 16.6%. The company has a stellar four-quarter average earnings surprise of over 4.16%.
Baxter International rose around 23.4% in the last one year, in comparison to the S&P 500. It has a four-quarter average earnings surprise of 17.14%.
Progenics Pharmaceuticals gained 56.6% in the past one year, better than the S&P 500 mark. It has a four-quarter average earnings surprise of 8.45%.
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Cardiovascular Systems (CSII) Swings to Earnings in Q3
Cardiovascular Systems, Inc. reported adjusted earnings per share of 3 cents in third-quarter fiscal 2017, reflecting a massive improvement from the year-ago quarter’s adjusted loss of 47 cents. The quarter’s number compared favorably with the Zacks Consensus Estimate of a loss of 4 cents.
The year-over-year improvement was primarily backed by revenue growth and lower operating expenses on account of the company’s cost realignment actions.
Quarter in Details
Cardiovascular Systems posted revenues of $52.1 million in the fiscal third quarter, marking a year-over-year increase of 17.3%. The figure surpassed the Zacks Consensus Estimate of $51 million.
Cardiovascular Systems, Inc. Price, Consensus and EPS Surprise
Cardiovascular Systems, Inc. Price, Consensus and EPS Surprise | Cardiovascular Systems, Inc. Quote
Per management, the strong top-line performance exhibited the company’s efforts to stabilize and support its field sales representatives.
During the reported quarter, Cardiovascular Systems sold over 15,700 devices, which generated 92% of revenues. The company added 37 new peripheral accounts and 35 coronary accounts.
Coronary device revenues improved 28% year over year to $13.5 million and peripheral device revenues rose 14% to $38.7 million.
Margin
Gross margin in the reported quarter was 78.6%, down 174 basis points (bps) year over year, primarily on account of a 27.6% rise in cost of goods sold.
Meanwhile, selling and administrative (SG&A) expenses contracted 11.8% to $37.3 million and research and development (R&D) expenses fell 5.5% to $5.4 million. The resultant adjusted operating expenses declined 11.1% to $42.7 million, primarily exhibiting management’s cost realignment initiatives and timing of studies and projects. Consequently, operating loss narrowed to a loss of $1.7 million from a loss of $12.3 million a year ago.
Financial position
The company exited the third quarter of fiscal 2017 with cash and cash equivalents of $103.1 million, compared with $79.2 million at the end of second-quarter 2017.
Outlook
Cardiovascular Systems issued its fourth-quarter fiscal 2017 guidance. The company expects revenues in the range of $51.5–$52.5 million. The current Zacks Consensus Estimate for fourth-quarter fiscal 2017 revenues is pegged at $52.8 million, slightly above the company’s guidance.
Moreover, the company expects gross profit to account for 81% of revenues, while operating expenses are estimated at around $43.5 million.
The company expects to incur net loss of $2.0–$1.4 million or loss per share of 6–4 cents in the fourth quarter. The current Zacks Consensus Estimate is pegged at a loss of 2 cents, narrower than the company’s guided range.
Our Take
Cardiovascular Systems delivered impressive third-quarter 2017 results. Additionally, the company’s lower operating expenses drove the year-over-year improvement in the earnings figure. Strong revenue performance also contributed to the upside in earnings. Per management, the company delivered improved results demonstrating significant progress in revenue growth, while moving toward positive cash flow and profitability.
Moreover, the company achieved several milestones during the quarter. Its Diamondback 360 coronary micro crown orbital atherectomy system was approved for the treatment of severely calcified coronary artery lesions by the Ministry of Health, Labor and Welfare in Japan and by the U.S. FDA. The six-month favorable data from the LIBERTY 360° trial were also presented at the International Symposium on Endovascular Therapy.
Zacks Rank & Key Picks
Cardiovascular Systems currently has a Zacks Rank #3 (Hold). Better-ranked medical stocks include Hologic, Inc. (HOLX - Free Report) , Baxter International Inc. (BAX - Free Report) and Progenics Pharmaceuticals, Inc. . Hologic and Progenics Pharmaceuticals sport a Zacks Rank 1 (Strong Buy), while Baxter International carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Hologic gained 33.6% in the last one year, in comparison to the S&P 500’s 16.6%. The company has a stellar four-quarter average earnings surprise of over 4.16%.
Baxter International rose around 23.4% in the last one year, in comparison to the S&P 500. It has a four-quarter average earnings surprise of 17.14%.
Progenics Pharmaceuticals gained 56.6% in the past one year, better than the S&P 500 mark. It has a four-quarter average earnings surprise of 8.45%.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
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