U.S. markets closed
  • S&P Futures

    3,837.25
    +9.25 (+0.24%)
     
  • Dow Futures

    31,412.00
    +41.00 (+0.13%)
     
  • Nasdaq Futures

    12,831.50
    -0.25 (-0.00%)
     
  • Russell 2000 Futures

    2,191.60
    -8.40 (-0.38%)
     
  • Crude Oil

    63.16
    -0.37 (-0.58%)
     
  • Gold

    1,771.80
    -3.60 (-0.20%)
     
  • Silver

    27.43
    -0.25 (-0.92%)
     
  • EUR/USD

    1.2177
    -0.0009 (-0.07%)
     
  • 10-Yr Bond

    1.5180
    +0.1290 (+9.29%)
     
  • Vix

    28.89
    +7.55 (+35.38%)
     
  • GBP/USD

    1.4014
    +0.0001 (+0.01%)
     
  • USD/JPY

    105.9530
    -0.2770 (-0.26%)
     
  • BTC-USD

    47,447.98
    -3,118.69 (-6.17%)
     
  • CMC Crypto 200

    944.09
    -50.57 (-5.08%)
     
  • FTSE 100

    6,651.96
    -7.01 (-0.11%)
     
  • Nikkei 225

    29,446.17
    -722.10 (-2.39%)
     

Stryker (SYK) Q3 Earnings and Revenues Surpass Estimates

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
Zacks Equity Research
·5 min read
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

Stryker Corporation SYK reported third-quarter 2020 adjusted earnings per share (EPS) of $2.14, which beat the Zacks Consensus Estimate of $1.40 by 52.9%. Moreover, the bottom line improved 12% year over year.

The Michigan-based medical device company reported revenues of $3.74 billion, which surpassed the Zacks Consensus Estimate by 9.9%. Also, the top line rose 4.2% on a year-over-year basis and 3.8% at constant currency (cc).   

Revenues by Geography

Revenues in United States came in at $2.75 billion, up 3.9% year over year. International sales were up 5% to $989 million.

Segmental Analysis

Orthopaedic: In the quarter under review, revenues in the segment totaled $1.32 billion, up 4.4% year over year. The segment’s revenues rose 3.8% at cc. The upside can be attributed to strong performance at the Knees, Hips and Trauma and Extremities sub segments, and growth in Mako.

Stryker Corporation Price, Consensus and EPS Surprise

Stryker Corporation Price, Consensus and EPS Surprise
Stryker Corporation Price, Consensus and EPS Surprise

Stryker Corporation price-consensus-eps-surprise-chart | Stryker Corporation Quote

MedSurg: This segment reported sales of $1.60 billion, up 3.2% year over year. Sales at the segment rose 2.9% at cc. Per management, the segment increased 2.5% organically in the reported quarter, courtesy of higher demand for the company’s safety related products.

Neurotechnology and Spine: Sales in the segment amounted to $820 million, up 6% year over year and 5.5% at cc. Organically, the segment witnessed a rise of 4.3%. Per management, the upside can be attributed to growth in all the neurotech product lines in the third quarter.

Margins

In the third quarter, adjusted gross profit totaled $2.46 billion, up 4.4% from the year-ago quarter. Adjusted gross margin was 65.9%, up 20 basis points (bps).

Adjusted operating income amounted to $1.05 billion, up 14.7% from the prior-year quarter. Adjusted operating margin was 28%, up 260 bps.

Financial Update

The company exited the third quarter with cash and cash equivalents of $7.08 billion, compared with $6.54 billion in the prior quarter.

Cumulative net cash provided by operating activities in the second quarter were $2.04 billion, reflecting an increase of 40.1% from the year-ago period.

2020 Outlook

Due to the continued uncertainty surrounding the magnitude and duration of the COVID-19 pandemic, and the uncertain timing of global recovery and economic normalization, the company is unable to project the overall impact on its operations and financial results. Consequently, the company hasn’t provided fourth-quarter or full-year 2020 organic sales or earnings outlook.

Wrapping Up

Stryker exited third-quarter 2020 on a strong note, with both earnings and revenues surpassing the Zacks Consensus Estimate. Moreover, the company witnessed strong performance across its segments. Growth in international sales is also a positive. Further, expansion in both gross and operating margins in the reported quarter buoys optimism.

The company remains committed to continued advancement of its new product pipelines. Per management, the company is poised to capitalize on the broader resumption of deferrable surgeries.

However, Stryker continues to grapple with pricing pressure. Stiff competition in the MedTech space also remains a concern.

Zacks Rank

Stryker currently carries a Zacks Rank #3 (Hold).

Earnings of Other MedTech Majors at a Glance

Some better-ranked stocks in the broader medical space that have already announced their quarterly results are Thermo Fisher Scientific Inc. TMO, Align Technology, Inc. ALGN and AngioDynamics, Inc. ANGO. While both Thermo Fisher and AngioDynamics carry a Zacks Rank of 2 (Buy), Align Technology sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Thermo Fisher reported third-quarter 2020 adjusted EPS of $5.63, beating the Zacks Consensus Estimate by 28.8%. Revenues of $8.52 billion surpassed the consensus mark by 10%.

AngioDynamics reported first-quarter fiscal 2021 adjusted earnings per share (EPS) of 2 cents against the Zacks Consensus Estimate of a loss per share of 6 cents. Revenues of $70.2 million beat the consensus mark by 6.9%.

Align Technology reported third-quarter 2020 adjusted EPS of $2.25, which surpassed the Zacks Consensus Estimate by 281.4%. Revenues of $734.1 million outpaced the consensus mark by 38%.

Have You Seen Zacks’ 2020 Election Stock Report?

The upcoming election could be a massive buying opportunity for savvy investors. Trillions of dollars will shift into new market sectors after the election. The question is, which sectors will soar for each candidate? Zacks has put together a new special report to help readers like you target big profits.

The 2020 Election Stock Report reveals specific stocks you’ll want to own immediately after the results are announced – 6 if Trump wins, 6 if Biden wins. Past election reports have led investors to gains of +71%, +83%, even +185% in the following months. This year’s picks could be even more lucrative.

Check out Zacks’ 2020 Election Stock Report >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Stryker Corporation (SYK) : Free Stock Analysis Report
 
AngioDynamics, Inc. (ANGO) : Free Stock Analysis Report
 
Align Technology, Inc. (ALGN) : Free Stock Analysis Report
 
Thermo Fisher Scientific Inc. (TMO) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.