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Glaukos (GKOS) Banks on Solid Pipeline Amid Stiff Competition

Zacks Equity Research

On Apr 1, we issued an updated research report on Glaukos Corporation GKOS. Glaukos’ strong pipeline is indicative of brighter prospects ahead. The company is currently developing several pipeline products — the iStent Infinite, the iStent Supra, the iStent SA, and iDose Travoprost.

The company has an impressive earnings surprise history, having outpaced the Zacks Consensus Estimate in two of the trailing four quarters, the average beat being 29.7%.

A glance at this Zacks Rank #3 (Hold) stock’s price performance shows that shares of Glaukos have gained 88.5% compared with the industry's 4.8% growth in a year’s time. The current level also compares favorably with the S&P 500 index's 4.4% decline over the same time frame.

Glaukos’ flagship, iStent, is the first FDA-approved surgical device available for insertion in conjunction with cataract surgery. This is done to reduce intraocular pressure in adult patients with mild-to-moderate open-angle glaucoma. It is a micro-scale MIGS treatment solution.

Currently, the iStent procedure is reimbursed in the United States by Medicare and all major national private payors. It is also commercially available in certain European Union countries, Brazil, Canada, Australia, Japan and other countries.

By the end of fourth-quarter 2018, Glaukos announced that the company has already initiated patient enrolment of key U.S. pivotal clinical studies for iDose Travoprost and iStent infinite. Management at Glaukos remains optimistic about the iStent platform worldwide, including emerging economies.

However, the stringent regulatory approval process for the iDose platform is concerning.

Cutthroat competition in the medical-device industry is an added headwind. Glaukos’ competitors include medical companies, academic and research institutions or others that develop new drugs, therapies, medical devices or surgical procedures to treat glaucoma.

Estimate Revision

The Zacks Consensus Estimate for 2019 is pegged at a loss of 33 cents. The same for revenues stands at $226.4 million, mirroring a 24.9% improvement year over year.

Glaukos Corporation Price and Consensus


Glaukos Corporation Price and Consensus | Glaukos Corporation Quote

Bottom Line

Despite cutthroat competition in the niche markets, Glaukos is likely to witness solid growth in the coming days. The company's long-term earnings growth rate of 32.7% also supports this view.

This apart, the company has an impressive Growth Style Score of B. Our Growth Style Score highlights all the vital metrics of a company’s financials to obtain a clearer picture of the quality and sustainability of its growth. Our research shows that stocks with a Style Score of A or B when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 offer the best investment opportunities.

Key Picks

A few better-ranked stocks from the MedTech space are Penumbra, Inc. PEN, Fluidigm Corporation FLDM and Tactile Systems Technology, Inc. TCMD, each carrying a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Penumbra delivered a positive earnings surprise in each of the trailing four quarters, the average being 321.2%.

Fluidigm has a long-term earnings growth rate of 25%.

Tactile Systems has a long-term earnings growth rate of 20%.

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