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Factors to Consider Ahead of Cutera's (CUTR) Q3 Earnings

Zacks Equity Research

Cutera, Inc. CUTR is set to release third-quarter 2019 results on Nov 7.

Notably, the company surpassed the Zacks Consensus Estimate for earnings in two of the trailing four quarters while missing the same twice, the average being 690.22%.

The Zacks Consensus Estimate for third-quarter revenues is currently pegged at $42.2 million, indicating year over year growth of approximately 4%.

The consensus for earnings is pegged at 5 cents per share, unchanged for the last 30 days. The figure indicates a decline of 54.5% from the year-ago quarter.




Coming to price performance, shares of Cutera have returned 94.1% year to date, significantly outperforming the industry’s rally of 29.7%.

Q2 at a Glance

Cutera had reported second-quarter 2019 non-GAAP earnings of 31 cents per share, which beat the Zacks Consensus Estimate by 30 cents.

Revenues of $47.8 million comfortably surpassed the Zacks Consensus Estimate of $42 million.

Let’s see how things are shaping up prior to this announcement.

Factors Likely to Influence Q3 Results

Cutera’s third-quarter top-line is likely to reflect solid demand for its truSculpt portfolio of products, including truSculpt iD (hands-free version) and truSculpt 3D. Further, incremental adoption of the company’s latest muscle sculpting system — truSculpt flex — is likely to have facilitated growth.

Notably, truSculpt flex is integrated with truSculpt iD's fat-reduction capabilities, which enables the physician to deliver comprehensive suite of body sculpting solutions to patients. Further, truSculpt flex allows clinician to sculpt a large coverage area with customizable treatment options. These functionalities are likely to have bolstered adoption in the third quarter.

Moreover, strength in other innovative body sculpting products, which includes microneedling system — Secret RF, women's health system — Juliet, among others is likely to have contributed to Cutera’s third-quarter revenues.

Increasing investments and expenses on marketing strategies in Japan are likely to have driven skincare revenues in the third-quarter. However, these initiatives are anticipated to have limited margin expansion.

Cutera, Inc. Price and EPS Surprise

 

Cutera, Inc. Price and EPS Surprise

Cutera, Inc. price-eps-surprise | Cutera, Inc. Quote

Regulatory Approvals Garnered in Q3  

During the quarter under review, truSculpt iD and truSculpt 3D systems, received regulatory approval from Brazil-based healthcare regulatory authority, Agência Nacional de Vigilância Sanitária (ANVISA). Further, truSculpt iD garnered regulatory approval from Health Canada to scale the use of the system in non-invasive lipolysis and reducing circumference of the abdomen.

The regulatory approvals are expected to aid the company in expanding the use cases of truSculpt platform and expand international presence.

What Our Model Says

According to the Zacks model, a combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Although Cutera has a Zacks Rank #3, an Earnings ESP of 0.00% makes surprise prediction difficult. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are a few stocks that you may consider, as our proven model shows that these have the right combination of elements to post an earnings beat this quarter.

Activision Blizzard, Inc ATVI has an Earnings ESP of +24.30% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Eyenovia, Inc. EYEN has an Earnings ESP of +10.51% and a Zacks Rank #2.

iHeartMedia, Inc. IHRT has an Earnings ESP of +3.17% and a Zacks Rank #2.

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