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A month has gone by since the last earnings report for Globus Medical (GMED). Shares have lost about 13.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Globus Medical due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Strong Musculoskeletal Solutions Sales Drive Globus Medical in Q1
Globus Medical reported first-quarter 2019 adjusted earnings per share (EPS) of 36 cents, missing both the Zacks Consensus Estimate and the year-ago figure by 12.2%.
On a reported basis, the company registered earnings of 33 cents per share, translating to a 15.4% decline from the year-ago quarter.
Revenue Details
First-quarter 2019 worldwide sales summed $182.9 billion, up 4.9% (up 5.7% at constant exchange rate or CER) year over year. The figure, however, lagged the Zacks Consensus Estimate of $186 million. Also, net sales totaled $713 million in the period, up 12.1% year over year.
During the quarter under review, sales generated in the United States including robotic inched up 1.3% year over year. Quarterly seasonality and longer sales cycles dampened robotic sales in the reported period.
International sales rose 23% from the year-earlier quarter (up 27.9% at CER).
Musculoskeletal solutions products generated revenues of $175.8 million, up 8.7% year over year. Enabling Technologies products revenues were $7.2 million in the quarter, representing a 44% decline from the prior-year period.
Cash Position
Globus Medical exited the first quarter with cash and cash equivalents and short-term marketable securities of $320.7 million compared with $339.8 million in 2018. For the first quarter, net cash provided by the operating activities was $39.2 million compared with $52.3 million a year ago.
2019 Guidance
The company reaffirmed its 2019 revenue and adjusted EPS guidance as follows:
Sales in 2019 are still projected to be $770 million. The Zacks Consensus Estimate for revenues is pegged at $769.8 million.
Adjusted EPS for 2019 is once again expected at $1.72. The Zacks Consensus Estimate for the metric is currently stands at $1.71 per share.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
At this time, Globus Medical has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.