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Nevro (NVRO) Posts Weak Preliminary Q4 and 2020 Revenues

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Zacks Equity Research
·3 min read
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Nevro Corp. NVRO recently provided an update on its preliminary fourth-quarter 2020 and full-year revenues.

The company is scheduled to release its December-quarter financial results on Feb 24, 2021.

Per the preliminary announcement, final-quarter 2020 worldwide revenues are anticipated to be $109.7 million, indicating a decline from the year-ago quarter’s figure of $114.4 million. Fourth-quarter 2020 U.S. revenues are projected to be $94.6 million, suggesting a fall from the year-ago period’s  number of $97.9 million.

The company’s international revenues are anticipated to be $15.1 million, implying a downside from the prior-year quarter’s figure of $16.5 million.

Notably, fourth-quarter U.S. trial procedures are expected to be reduced nearly 8% year over year.

Per the issuance of preliminary results, Nevro's 2020 worldwide revenues are projected to be $362 million, hinting at a decrease from the year-ago quarter’s figure of $390.3 million. Full-year U.S. revenues are projected to be $311.9 million, indicating a drop from the prior-year period’s number of $326 million.

The company anticipates its full-year international revenues to be $50.2 million, implying a decline from the year-ago quarter’s figure of $64.3 million.

Shares Down

Following the announcement of its preliminary results, shares of Nevro dipped 1.1% to $169.15 at the close of the day’s trading session.

Highlights

In the second half of the fourth quarter, higher COVID-related activity left an adverse impact on both trial and permanent implant volumes.

Nonetheless, despite the year-long turbulent period, the company’s market share in the core lower back and leg pain space continued to expand with its top-notch SCS technology, clinical data and enhanced execution. In fact, per management, Nevro has growth prospects post the COVID-19-induced pressure on its business subsides.

Management is optimistic about better growth opportunities with respect to the treatment of Painful Diabetic Neuropathy and Non-Surgical Refractory Back Pain that will bring the company’s HF10 therapy to a number of patients who are unable to get relief with the presently available treatment options.

Price Performance

In the past three months, the stock has gained 11.1% compared with the 6.5% growth of its industry.

Zacks Rank and Key Picks

Nevro currently has a Zacks Rank #3 (Hold). Some better-ranked stocks from the broader medical space are McKesson Corporation MCK, PerkinElmer PKI and IDEXX Laboratories IDXX. While PerkinElmer sports a Zacks Rank #1 (Strong Buy), the other two carry a Zacks Rank #2 (Buy), presently. You can see the complete list of today’s Zacks #1 Rank stocks here.

McKesson has a projected long-term earnings growth rate of 6.6%.

PerkinElmer has a projected long-term earnings growth rate of 19.5%.

IDEXX has an estimated long-term earnings growth rate of 15.8%.

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