Integer Holdings Corporation ITGR is well-poised for growth on portfolio management, and strong presence in the broader MedTech space. However, stiff competition remains a concern.
Shares of Integer Holdings have gained 22.3% in a year’s time, compared with the industry’s growth of 18.4%. Meanwhile, the S&P 500 Index rose 35.8% in the same time frame.
The company, with a market capitalization of $2.97 billion, manufactures and develops medical devices and components primarily for original equipment manufacturers (OEMs), which depend on it to design, develop and produce intellectual property protected medical device technologies. It has a trailing four-quarter earnings surprise of 15.9%, on average.
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Let’s take a closer look at the factors that substantiate the company’s Zacks Rank #3 (Hold).
What’s Weighing on the Stock?
Integer Holdings currently operates in the highly competitive MedTech market. Consequently, intense competition remains a headwind.
What’s Favoring the Stock?
Integer Holdings has initiated a new approach to drive sales and profitable growth, following a comprehensive strategic review of the business. Its new strategy has two overarching themes that are focused on portfolio management and operational excellence. This will help the company to realize its vision of enhancing patient lives.
Per the first-quarter 2021 earnings call, the company has maintained strategic investments amid the pandemic. Notably, management is optimistic that its customers and patients are ultimately benefiting from the same.
The company plans to invest more in the areas of Cardio & Vascular, Neuromodulation, and Electrochem to accelerate sales and market penetration. Integer Holdings has also been improving profitability in areas of Advanced Surgical, Orthopedics, and Power Solutions through focused sales growth and cost structure initiatives.
Further, it continues to benefit from strong presence in the broader MedTech space. This, in turn, will drive overall performance.
For 2021, the Zacks Consensus Estimate for revenues is pegged at $1.20 billion, indicating an improvement of 11.3% from the year-ago period. The same for earnings stands at $3.85 per share, suggesting growth of 38.9% from the previous year.
Stocks to Consider
Some better-ranked stocks from the broader medical space are Veeva Systems Inc. VEEV, DaVita Inc. DVA and Encompass Health Corporation EHC, each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Veeva Systems’ long-term earnings growth rate is estimated at 15.8%.
DaVita’s long-term earnings growth rate is estimated at 14.4%.
Encompass Health’s long-term earnings growth rate is projected at 17.3%.
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