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Integra (IART) Rises 5% on Robust Preliminary Q4 Results

Zacks Equity Research

Shares of Integra LifeSciences Holdings Corporation IART gained 4.8% to close at $46.57 on Tuesday following the announcement of strong preliminary fourth-quarter 2018 financial results. The company is expected to release its final, audited fourth-quarter and full-year financial report in February 2019.

The Prelim Results

In the to-be-reported quarter, Integra LifeSciences estimates total revenues to come in at the upper end of its previously projected band of $378-$383 million. Organic revenue growth for the fourth quarter of 2018 is anticipated to be slightly above 4%. The Zacks Consensus Estimate for fourth-quarter revenues is currently pegged at $380.83 million, dipping 0.6% below the upper end of the guided range.

Notably, on last reported quarter’s earnings call, the company lowered its full-year revenue forecast to $1.467-$1.472 billion (earlier, the outlook was $1.475-$1.49 billion). The Zacks Consensus Estimate for 2018 revenues of $1.49 billion remains above the predicted range. Per Integra LifeSciences, the view was trimmed on expectation of approximately 4% organic growth for 2018 as compared to the past projection of nearly 5%.

However, the company reiterates its full-year forecast for adjusted earnings per share within $2.36-$2.42. The Zacks Consensus Estimate for the metric is pegged at $2.40, falling under the company’s envisioned band.

CFO Alliance Update

In a separate press release, the company signed a license and development agreement with Consortium of Focused Orthopedists, LLC (CFO) for a short stem and stemless shoulder system. According to Integra LifeSciences, the alliance will expand the company’s Extremity Orthopedics portfolio in the fast-growing shoulder arthroplasty market.

Share Price Movement

Shares of the company have underperformed its industry over the past six months. The stock has lost 10.1%, wider than the 26.6% decline of the industry.

Zacks Rank & Key Picks

Integra LifeSciences currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the broader medical space are Veeva Systems VEEV, Surmodics, Inc. SRDX and athenahealth, Inc. ATHN.

Veeva Systems’ long-term earnings growth rate is estimated at 19.5%. The stock flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Surmodics’ long-term earnings growth rate is projected at 10%. The stock carries a Zacks Rank #2 (Buy).

athenahealth’s long-term earnings growth rate is projected at 17.7%. The stock has a Zacks Rank of 2.

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