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NuVasive (NUVA) Down 6.1% Since Last Earnings Report: Can It Rebound?

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A month has gone by since the last earnings report for NuVasive (NUVA). Shares have lost about 6.1% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is NuVasive due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

NuVasive (NUVA) Q2 Earnings Beat Estimates, Gross Margin Up

NuVasive, Inc. (NUVA) delivered second-quarter 2021 adjusted earnings per share of 60 cents, a significant improvement from the year-ago adjusted loss per share of 40 cents. The figure also beat the Zacks Consensus Estimate by 39.5%.

The one-time adjustments include expenses associated with certain business transition costs and amortization expenses, among others.

GAAP earnings per share of 3 cents too was a huge improvement from the year-ago loss per share of 98 cents.

Total Revenues

Revenues in the second quarter totaled $294.8 million, up 44.8% year over year on a reported basis (up 43.3% at constant exchange rate or CER). The top line surpassed the Zacks Consensus Estimate by 3%.

The increase in revenues can be attributed to recovery from the COVID-19 pandemic across all procedural segments and continued strong international growth.

Geographical & Segmental Details

In the reported quarter, U.S. Spinal Hardware business revenues rose 40.7% year over year to $160.1 million. The business was primarily boosted by continued demand for products within NuVasive’s Advanced Materials Science portfolio.

Revenues from the U.S. Surgical Support business were $67.6 million in the second quarter, up 43.2% increase year over year. This sales growth was primarily attributed to increased surgical volumes in NuVasive’s hardware procedures.

In the quarter, the company registered international revenues of $67.2 million, reflecting a 57.5% year-over-year rise on a reported basis and 50.3% increase at CER. This strong growth was led by the Europe, Japan and Asia-Pacific region and continued growth in NuVasive’s core Spine business despite pockets of COVID-19 impact.

Margin Details

In the reported quarter, gross profit improved 75.9% year over year to $216.6 million. Gross margin expanded 1299 basis points (bps) to 73.5%.

Selling, general and administrative expenses increased 24.5% year over year to $157.4 million, whereas research and development (R&D) expenses climbed 12.2% year over year to $21.8 million.

Overall adjusted operating profit was $37.4 million, up from the year-ago adjusted operating loss of $22.7 million.

Financial Details

The company exited second-quarter 2021 with cash and cash equivalents of $204.1 million compared with $233.9 million at the end of first-quarter 2021.

Cumulative net cash provided by operating activities at the end of second-quarter 2021 was $79.4 million compared with the prior-year period’s $33.1 million.

2021 Guidance

NuVasive has provided its financial outlook for full-year 2021.

The company currently expects to report revenues in the range of $1.19-$1.21 billion. The Zacks Consensus Estimate for the same is pegged at $1.2 billion.

Adjusted earnings per share are projected in the range of $2.25-$2.35, the Zacks Consensus Estimate for which is pegged at $2.16. Adjusted operating margin is estimated in the range of 14.4% to 14.9%.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates.

VGM Scores

Currently, NuVasive has a nice Growth Score of B, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.


Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, NuVasive has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

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