Globus Medical, Inc. GMED reported fourth-quarter 2024 adjusted earnings per share (EPS) of 84 cents, which beat the Zacks Consensus Estimate by 10.5%. The figure increased 40% year over year.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
The adjusted EPS excludes certain non-recurring expenses and benefits, such as the amortization of intangibles, merger and acquisition-related costs/licensing and provision for litigation.
Without adjustments, the company registered a GAAP diluted EPS of 19 cents, up 72.7% from the year-ago period’s figure.
For the full year, adjusted earnings were $3.04 per share, 31% up from the year-ago period. The metric also surpassed the Zacks Consensus Estimate by 2%.
Worldwide sales increased 6.6% year over year to $657.3 million. The reported figure exceeded the Zacks Consensus Estimate by 2%.
Net sales improvement was driven by the addition of NuVasive, as well as increased volume of spine product sales and enabling technology volume.
Full-year revenues were $2.52 billion, reflecting a 60.6% increase from the year-ago period (61.1% at a constant-currency basis or CER). The figure topped the Zacks Consensus Estimate by 0.8%.
Following the earnings announcement, GMED stock dropped 0.3% in after-market trading yesterday.
GMED’s Q4 Geographic Details
Net sales generated in the United States increased 6.3% year over year (same at CER) to $521.9 million. This surpassed our model’s projection of $511.8 million in sales from this region.
Globus Medical, Inc. Price, Consensus and EPS Surprise
Globus Medical, Inc. Price, Consensus and EPS Surprise
Globus Medical, Inc. price-consensus-eps-surprise-chart | Globus Medical, Inc. Quote
Across international markets, revenues increased 7.7% (up 8.9% at CER) to $135.4 million, which also topped our model estimate of $128.6 million.
GMED’s Product-Wise Q4 Sales
Musculoskeletal Solutions generated revenues of $610.3 million, up 4.5% year over year. Our model projected $602.2 million in sales for this segment.
Enabling Technologies generated revenues of $46.9 million, up 43.5% from the prior-year reported figure. The reported figure also surpassed our model estimate of $38.1 million.
GMED’s Q4 Margin Performance
The gross profit in the reported quarter rose 12.2% year over year to $393.9 million. However, the gross margin expanded 298 basis points (bps) to 60% on a 0.8% drop in the cost of sales (exclusive of amortization of intangibles).
SG&A expenses in the reported quarter totaled $253.5 million, up 3.6% from the year-ago quarter’s level. Research and development expenses decreased 36.1% to $33.4 million.
The adjusted operating profit rose 97.8% from the year-ago figure to $106.9 million. The adjusted operating margin surged 750 bps to 16.3% due to lower operating expenses.
GMED’s Cash Position
Globus Medical exited the fourth quarter of 2024 with combined cash and cash equivalents and short-term marketable securities of $890.1 million compared with $517.8 million at the end of 2023.
Cumulative net cash provided by operating activities at the end of the fourth quarter was $520.6 million compared with the year-ago figure of $243.5 million.
GMED Reiterates 2025 View, Shares Post-Nevro Outlook
Globus Medical has reaffirmed its stand-alone full-year 2025 guidance, initially shared in its preliminary 2024 fourth-quarter results release.
For 2025, revenues are projected in the range of $2.66-$2.69 billion (unchanged). The Zacks Consensus Estimate is currently pegged at $2.67 billion. The company expects adjusted EPS in the range of $3.40-$3.50 (the same as earlier). The Zacks Consensus Estimate is pegged at $3.47.
Earlier this month, Globus Medical announced a definitive agreement to acquire all shares of Nevro Corp. in an all-cash transaction valued at $250 million. The transaction further expands the company’s reach into the musculoskeletal market, adding an additional $2 billion market space to compete in and grow. Following the completion of the deal, expected in the late second quarter of 2025, Globus Medical anticipates net sales in the band of $2.80 billion-$2.90 billion and adjusted EPS in the range of $3.10-$3.40 for the full year.
Our Take on GMED
Globus Medical exited the fourth quarter of 2024 with both earnings and revenues beating the respective estimates. The performance reflects the strong potential of the combined Globus-NuVasive organization and the growing value creation from the merger. Impressively, the company registered the highest quarterly Enabling Technology sales and unit placements to date. GMED also introduced five new innovative products, including the Cortex MIS and Allegiance retractor systems. On top of that, the robust expansion of margins in the quarter is highly encouraging.
GMED’s Zacks Rank & Key Picks
GMED currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader medical space are ResMed RMD, Cardinal Health CAH and Bio-RadLaboratories BIO.
ResMed reported a second-quarter fiscal 2025 adjusted EPS of $2.43, which topped the Zacks Consensus Estimate by 5.6%. Revenues of $1.28 billion exceeded the Zacks Consensus Estimate by 1.6%. RMD carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
RMD has an estimated fiscal 2025 earnings growth rate of 21.9% compared with the industry’s 13.2%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.9%.
Cardinal Health, carrying a Zacks Rank #2, posted a second-quarter fiscal 2025 adjusted EPS of $1.93, topping the Zacks Consensus Estimate by 10.3%. Revenues of $55.26 billion exceeded the Zacks Consensus Estimate by 0.7%.
CAH has an estimated five-year earnings growth rate of 10.7% compared with the industry’s 9.3%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.
Bio-Rad Laboratories, carrying a Zacks Rank #2, posted a third-quarter 2024 adjusted EPS of $2.01, topping the Zacks Consensus Estimate by 57%. Revenues of $649.7 million exceeded the Zacks Consensus Estimate by 2%.
BIO has an earnings yield of 3.3% compared with the industry’s 0.6% yield. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 30.5%.
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