It has been about a month since the last earnings report for Abiomed (ABMD). Shares have added about 0.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Abiomed due for a pullback? 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 drivers.
ABIOMED Q4 Earnings Meet Estimates, Sales Rise in Japan
ABIOMED reported fourth-quarter fiscal 2019 earnings per share (EPS) of $1.07, which were in line with the Zacks Consensus Estimate. The bottom line rose 33.8% from the figure registered in the year-ago quarter.
The company’s revenues came in at $207.1 million, missing the Zacks Consensus Estimate of $217.7 million. However, the metric improved 18.7% from the prior-year quarter.
Q4 in Detail
Worldwide Impella heart pump revenues in the reported quarter totaled $199.5 million, reflecting an increase of 19% year over year.
U.S. Impella product revenues totaled $169.7 million, an increase of 16% year over year. Per management, U.S. patient usage of the Impella heart pumps rose 14% in the quarter.
Outside the United States, Impella product revenues totaled $29.8 million, highlighting an increase of 35% year over year. Japan revenues were $5.4 million in the quarter, up a substantial 212% year over year.
In the quarter under review, gross margin was 83.2% of net revenues, up 50 basis points (bps) year over year. Research & Development (R&D) costs grossed $25.5 million, up 20.1% year over year.
Operating income totaled $65.4 million, up 37.4% on a year-over-year basis. Operating margin was 31.6%, up 430 bps.
ABIOMED’s balance sheet remains debt free. The company ended the fiscal fourth quarter with $513.4 million of cash and marketable securities.
For fiscal 2020, ABIOMED expects total revenues within $900-$945 million, suggesting an increase of 17-23% from fiscal 2019.
How Have Estimates Been Moving Since Then?
Fresh estimates followed a downward path over the past two months. The consensus estimate has shifted -7.1% due to these changes.
Currently, Abiomed has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Abiomed has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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