AngioDynamics (ANGO) Q4 Earnings Lag Estimates, Revenues Top
AngioDynamics, Inc. ANGO reported adjusted earnings per share (EPS) of 2 cents for fourth-quarter fiscal 2023 compared with the year-ago EPS of a penny. However, the adjusted EPS lagged the Zacks Consensus Estimate by 33.3%.
GAAP loss per share was 54 cents, wider than the year-over-year loss of 16 cents per share.
Full-year adjusted loss per share was 6 cents against the break-even EPS at the end of the comparable fiscal 2022 period. The figure was in line with the Zacks Consensus Estimate.
Revenue Details
Revenues in the fiscal fourth quarter totaled $91.1 million, up 4.7% year over year on a reported basis (up 4.9% at constant exchange rate or CER). The top line topped the Zacks Consensus Estimate by 0.4%.
The company continued to see strong contributions from its Med Tech (which include the Auryon peripheral atherectomy platform, the thrombus management platform and the NanoKnife irreversible electroporation platform) and Med Device businesses during the quarter.
Full-year revenues were $338.8 million, reflecting a 7.1% uptick on a reported basis from the comparable fiscal 2022 period. The figure surpassed the Zacks Consensus Estimate marginally by 0.1%.
At CER, full-year revenues were up 7.5%.
Geographical Analysis
In the quarter under review, U.S. net revenues totaled $74.4 million, up 0.9% year over year.
This figure compares to our U.S. net revenues’ fiscal fourth-quarter projection of $76.2 million.
International revenues came in at $16.6 million, up 25.1% from the year-ago quarter on a reported basis and up 26.2% at CER.
This figure compares to our fiscal fourth-quarter International revenues’ projection of $14.3 million.
Segmental Analysis
AngioDynamics derives revenues from two businesses — Med Tech and Med Device.
The Med Tech business’ net sales in the fiscal fourth quarter were $26.5 million, reflecting an uptick of 17.2% year over year. This was primarily on the back of increased net sales of Auryon amounting to $11.8 million (up 22%) and NanoKnife disposable sales of $4.6 million (up 28%) compared with the prior-year quarter. AlphaVac sales in the reported quarter were $1.8 million, up 86.9% year over year. However, the improvement in the Med Tech segment was partially offset by a decline of 8.3% in AngioVac sales which amounted to $6.1 million in the quarter.
This figure compares to our fiscal fourth quarter’s Med Tech business’ net sales projection of $26.9 million.
Med Device revenues in the fiscal fourth quarter grossed $64.6 million, up 0.3% from the year-ago period. This was primarily driven by strength in AngioDynamics’ angiographic products and the dialysis business.
This figure compares to our fiscal fourth quarter’s Med Device business’ net sales projection of $63.6 million.
AngioDynamics, Inc. Price, Consensus and EPS Surprise
AngioDynamics, Inc. price-consensus-eps-surprise-chart | AngioDynamics, Inc. Quote
Margin Analysis
In the quarter under review, AngioDynamics’ gross profit fell 0.2% to $46.4 million. The gross margin contracted 250 basis points (bps) to 50.9%.
We had projected 52.1% of gross margin for fourth-quarter fiscal 2023.
Sales and marketing expenses fell 2% to $26.3 million year over year. Research and development expenses decreased 0.1% year over year to $7.9 million, whereas general and administrative expenses declined 7.9% year over year to $10.2 million. Adjusted operating expenses of $44.4 million decreased 3.1% year over year.
The adjusted operating profit totaled $1.9 million, which surged 202.9% from the prior-year quarter. The adjusted operating margin in the fiscal fourth quarter expanded 142 bps to 2.2%.
Cash Position
AngioDynamics exited fiscal 2023 with cash and cash equivalents of $44.6 million compared with $28.8 million at the end of fiscal 2022. The long-term debt (net of current portion) at the end of fiscal 2023 was $49.8 million compared with $25 million at the end of fiscal 2022.
Cumulative net cash provided by operating activities was $78 million against net cash used in operating activities of $7.2 million a year ago.
FY24 Guidance
AngioDynamics has initiated its guidance for fiscal 2024.
The company expects its net sales in the range of $328 million-$333 million.
The adjusted loss per share is projected to be between 28 cents and 34 cents.
Our Take
AngioDynamics exited the fourth quarter of fiscal 2023 with better-than-expected revenues. The quarter’s adjusted EPS performance and a solid uptick in the overall top line were impressive. Robust domestic and international revenues were also encouraging. The company continued gaining from its Med Tech and Med Device businesses, which was promising. Robust sales of Auryon and NanoKnife looked encouraging. Continued positive physician feedback for both the F22 and F18 versions of AlphaVac also bodes well. The expansion of the adjusted operating margin augurs well.
On the fiscal fourth-quarter earnings call, AngioDynamics’ management confirmed that it is currently preparing to launch a new version of the Auryon product for use in the lower extremities segment of the venous thrombectomy market. Management also confirmed that the APEX study, evaluating AlphaVac F18 as a treatment for pulmonary embolism, is more than 50% enrolled and expects to complete enrollment this winter and submit the results to the FDA in the first half of the calendar year 2024. These raise optimism about the stock.
However, AngioDynamics’ lower-than-expected EPS and lower revenues from AngioVac sales in the fiscal fourth quarter were disappointing. The gross margin contraction does not bode well. Continued supply chain disruptions and inflationary pressures also raise apprehension.
Zacks Rank & Key Picks
AngioDynamics currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader medical space that are supposed to report earnings soon are DexCom, Inc. DXCM, Becton, Dickinson and Company BDX, popularly known as BD, and Boston Scientific Corporation BSX.
The Zacks Consensus Estimate for DexCom’s second-quarter 2023 adjusted EPS is currently pegged at 22 cents. The consensus estimate for revenues is pegged at $837 million. DexCom currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
DexCom has an estimated long-term growth rate of 40.4%. DXCM’s earnings yield of 0.8% compares favorably with the industry’s negative yield.
BD currently has a Zacks Rank #2. The Zacks Consensus Estimate for its third-quarter fiscal 2023 adjusted EPS is currently pegged at $2.88. The same for revenues is pegged at $4.83 billion.
BD has an estimated long-term growth rate of 10.1%. BDX’s earnings yield of 4.7% compares favorably with the industry’s 4.1%.
Boston Scientific currently carries a Zacks Rank #2. The Zacks Consensus Estimate for its second-quarter 2023 adjusted EPS is currently pegged at 49 cents. The same for its revenues stands at $3.49 billion.
Boston Scientific has an estimated long-term growth rate of 11.5%. BSX’s earnings yield of 3.7% compares favorably with the industry’s negative yield.
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