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Surmodics (SRDX) Reports Q4 Loss, Revenues Beat Estimates

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·4 min read
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Surmodics, Inc. SRDX reported adjusted loss per share of 18 cents in fourth-quarter fiscal 2020 against the Zacks Consensus Estimate of earnings per share (EPS) of a penny. Also, the company reported adjusted EPS of 37 cents in the year-ago quarter.

For fiscal 2020, adjusted EPS came in at 13 cents, missing the Zacks Consensus Estimate by 58.1%. The figure declined 81.9% year over year.

Revenues

Revenues for the quarter totaled $22.5 million, beating the Zacks Consensus Estimate by 4%. The figure, however, fell 26.9% year over year.

For fiscal 2020, revenues came in at $94.9 million, beating the Zacks Consensus Estimate by 1.1%.However, the figure fell 5.2%.

Fiscal Q4 Highlights

In the quarter under review, Product sales were $10.6 million, down 0.9% from the prior-year quarter. Royalty and license fee revenues totaled $9.9 million, down 41.1% from the prior-year quarter. Research, development and other revenues were $2.1 million, down 36.4% year over year.

Segmental Analysis

Medical Device

In the reported quarter, sales at the segment came in at $17.2 million, down 30.9% from the year-ago quarter.

In Vitro Diagnostics

In the quarter under review, sales fell 10.1% to $5.4 million.

Operational Details

Gross profit for the quarter came in at 18.6 million, down 31.4% year over year. Gross margin was 82.7%, down 544 basis points (bps).

The company reported adjusted operating loss of $ 1.4 million against the year-ago quarter’s operating profit of $5.4 million.

Surmodics, Inc. Price, Consensus and EPS Surprise

 

Surmodics, Inc. Price, Consensus and EPS Surprise
Surmodics, Inc. Price, Consensus and EPS Surprise

 

Surmodics, Inc. price-consensus-eps-surprise-chart | Surmodics, Inc. Quote

Cash Position

The company exited fiscal 2020 with cash and cash equivalents of $30.8 million, compared with $30.4 million a year ago.

Cumulative net cash provided by operating activities came in at $1.3 million compared with $12.5 million in the year-ago period.

Fiscal 2021 Guidance

Due to the continued uncertainty surrounding the duration and extent of the COVID-19 pandemic, Surmodics will not issue any financial guidance for fiscal 2021 for the time being.

Our Take

Surmodics exited the fiscal 2020 on a mixed note. The FDA clearance received for Pounce Thrombus Retrieval System in the quarter is encouraging.

Management is upbeat about the company’s partnership with Cook Medical for the commercialization of .014” and .018” low-profile PTA balloon catheters. The CE Mark for its SurVeil drug coated balloon (DCB) and FDA clearance for Sublime radial-access 0.014” PTA balloon catheter continued to instill optimism.

However, the company registered revenue decline in each of its core units viz. In Vitro Diagnostics and Medical Device. The company also saw a decline in Product sales and Royalty and license fee, and research, development and other revenues in the quarter under review. Contraction in gross margin is also concerning.

Zacks Rank and Key Picks

Surmodics currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the broader medical space that have announced their quarterly results are Thermo Fisher Scientific Inc. TMO, Align Technology, Inc. ALGN and AngioDynamics, Inc. ANGO. While Align Technology currently sports a Zacks Rank #1 (Strong Buy), the other two carry a Zacks Rank of 2 (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%.

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%.

AngioDynamics reported first-quarter fiscal 2021 adjusted 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%.

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