Spotting Winners: Teleflex (NYSE:TFX) And Surgical Equipment & Consumables - Specialty Stocks In Q4
The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how surgical equipment & consumables - specialty stocks fared in Q4, starting with Teleflex (NYSE:TFX).
The surgical equipment and consumables industry provides tools, devices, and disposable products essential for surgeries and medical procedures. These companies therefore benefit from relatively consistent demand, driven by the ongoing need for medical interventions, recurring revenue from consumables, and long-term contracts with hospitals and healthcare providers. However, the high costs of R&D and regulatory compliance, coupled with intense competition and pricing pressures from cost-conscious customers, can constrain profitability. Over the next few years, tailwinds include aging populations, which tend to need surgical interventions at higher rates. The increasing integration of AI and robotics into surgical procedures could also create opportunities for differentiation and innovation. However, the industry faces headwinds including potential supply chain vulnerabilities, evolving regulatory requirements, and more widespread efforts to make healthcare less costly.
The 4 surgical equipment & consumables - specialty stocks we track reported a mixed Q4. As a group, revenues beat analysts’ consensus estimates by 0.7% while next quarter’s revenue guidance was in line.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 20.8% since the latest earnings results.
Weakest Q4: Teleflex (NYSE:TFX)
With a portfolio spanning from vascular access catheters to minimally invasive surgical tools, Teleflex (NYSE:TFX) designs, manufactures, and supplies single-use medical devices used in critical care and surgical procedures across hospitals worldwide.
Teleflex reported revenues of $795.4 million, up 2.8% year on year. This print fell short of analysts’ expectations by 2.3%. Overall, it was a softer quarter for the company with a miss of analysts’ constant currency revenue estimates.
"In the fourth quarter, we delivered strong double-digit adjusted earnings per share growth" said Liam Kelly, Teleflex's Chairman, President and Chief Executive Officer.
Teleflex Total Revenue
Teleflex delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. Unsurprisingly, the stock is down 25.3% since reporting and currently trades at $132.62.
Pioneering minimally invasive surgery since its first da Vinci system was FDA-cleared in 2000, Intuitive Surgical (NASDAQ:ISRG) develops and manufactures robotic-assisted surgical systems that enable minimally invasive procedures across various medical specialties.
Intuitive Surgical reported revenues of $2.41 billion, up 25.2% year on year, outperforming analysts’ expectations by 6.5%. The business had an incredible quarter with a solid beat of analysts’ sales volume and EPS estimates.
Intuitive Surgical Total Revenue
Intuitive Surgical pulled off the biggest analyst estimates beat and fastest revenue growth among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 18.8% since reporting. It currently trades at $493.50.
Founded in 1989 as a pioneer in regenerative medicine technology, Integra LifeSciences (NASDAQ:IART) develops and manufactures medical technologies for neurosurgery, wound care, and surgical reconstruction, including regenerative tissue products and surgical instruments.
Integra LifeSciences reported revenues of $442.6 million, up 11.5% year on year, falling short of analysts’ expectations by 0.7%. It was a slower quarter as it posted a miss of analysts’ full-year EPS guidance estimates.
Integra LifeSciences delivered the weakest full-year guidance update in the group. As expected, the stock is down 22.6% since the results and currently trades at $17.06.
Founded in 1983 and named after a pioneering vascular surgeon, LeMaitre Vascular (NASDAQGM:LMAT) develops and manufactures specialized medical devices used by vascular surgeons to treat peripheral vascular disease and other circulatory conditions.
LeMaitre reported revenues of $55.72 million, up 14% year on year. This number missed analysts’ expectations by 0.7%. Taking a step back, it was a mixed quarter as it also produced an impressive beat of analysts’ full-year EPS guidance estimates but a slight miss of analysts’ EPS estimates.
LeMaitre delivered the highest full-year guidance raise among its peers. The stock is down 16.6% since reporting and currently trades at $83.40.
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
Want to invest in winners with rock-solid fundamentals? Check out our Top 6 Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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