Looking back on medical devices & supplies - specialty stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Integer Holdings (NYSE:ITGR) and its peers.
The medical devices industry operates a business model that balances steady demand with significant investments in innovation and regulatory compliance. The industry benefits from recurring revenue streams tied to consumables, maintenance services, and incremental upgrades to the latest technologies, although specialty devices are more niche. The capital-intensive nature of product development, coupled with lengthy regulatory pathways and the need for clinical validation, can weigh on profitability and timelines. In addition, there are constant pricing pressures from healthcare systems and insurers maximizing cost efficiency. Over the next several years, one tailwind is demographic–aging populations means rising chronic disease rates that drive greater demand for medical interventions and monitoring solutions. Advances in digital health, such as remote patient monitoring and smart devices, are also expected to unlock new demand by shortening upgrade cycles. On the other hand, the industry faces headwinds from pricing and reimbursement pressures as healthcare providers increasingly adopt value-based care models. Additionally, the integration of cybersecurity for connected devices adds further risk and complexity for device manufacturers.
The 7 medical devices & supplies - specialty stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.7%.
Thankfully, share prices of the companies have been resilient as they are up 5.2% on average since the latest earnings results.
Weakest Q3: Integer Holdings (NYSE:ITGR)
With its name reflecting the mathematical term for "whole" or "complete," Integer Holdings (NYSE:ITGR) is a medical device outsource manufacturer that produces components and systems for cardiac, vascular, neurological, and other medical applications.
Integer Holdings reported revenues of $467.7 million, up 8.4% year on year. This print was in line with analysts’ expectations, but overall, it was a slower quarter for the company with full-year EBITDA guidance missing analysts’ expectations significantly and full-year revenue guidance slightly missing analysts’ expectations.
“Integer delivered another strong quarter of growth with sales up 8%, adjusted operating income up 14%, and adjusted EPS growth of 25%,” said Joseph Dziedzic, Integer’s president and CEO.
Unsurprisingly, the stock is down 37.5% since reporting and currently trades at $68.25.
Read our full report on Integer Holdings here, it’s free for active Edge members.
Best Q3: STAAR Surgical (NASDAQ:STAA)
With over 2.5 million implants performed worldwide, STAAR Surgical (NASDAQ:STAA) designs and manufactures implantable lenses that correct vision problems without removing the eye's natural lens.
STAAR Surgical reported revenues of $94.73 million, up 6.9% year on year, outperforming analysts’ expectations by 4.3%. The business had a stunning quarter with an impressive beat of analysts’ constant currency revenue estimates and a beat of analysts’ EPS estimates.
However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $26.55.
Is now the time to buy STAAR Surgical? Access our full analysis of the earnings results here, it’s free for active Edge members.
Bausch + Lomb (NYSE:BLCO)
With a nearly 170-year history dedicated to vision care and eye health innovation, Bausch + Lomb (NYSE:BLCO) develops and manufactures a comprehensive range of eye health products including contact lenses, pharmaceuticals, surgical devices, and consumer eye care solutions.
Bausch + Lomb reported revenues of $1.28 billion, up 7.1% year on year, in line with analysts’ expectations. Still, it was a satisfactory quarter as it posted a beat of analysts’ EPS estimates.
Bausch + Lomb delivered the highest full-year guidance raise but had the weakest performance against analyst estimates in the group. Interestingly, the stock is up 3% since the results and currently trades at $15.63.
Read our full analysis of Bausch + Lomb’s results here.
Haemonetics (NYSE:HAE)
With roots dating back to 1971 and a mission to improve blood-related healthcare, Haemonetics (NYSE:HAE) provides specialized medical devices and software for blood collection, processing, and management across plasma centers, blood banks, and hospitals.
Haemonetics reported revenues of $327.3 million, down 5.3% year on year. This number topped analysts’ expectations by 5.3%. It was an exceptional quarter as it also recorded a solid beat of analysts’ organic revenue estimates and an impressive beat of analysts’ revenue estimates.
Haemonetics pulled off the biggest analyst estimates beat but had the slowest revenue growth among its peers. The stock is up 35% since reporting and currently trades at $68.45.
Read our full, actionable report on Haemonetics here, it’s free for active Edge members.
Enovis (NYSE:ENOV)
With a focus on helping patients regain or maintain their natural motion, Enovis (NYSE:ENOV) develops and manufactures medical devices for orthopedic care, from injury prevention and pain management to joint replacement and rehabilitation.
Enovis reported revenues of $548.9 million, up 8.6% year on year. This result beat analysts’ expectations by 2.1%. Overall, it was a strong quarter as it also produced a beat of analysts’ EPS estimates and a solid beat of analysts’ revenue estimates.
The stock is down 10.9% since reporting and currently trades at $28.06.
Read our full, actionable report on Enovis here, it’s free for active Edge members.
Market Update
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.
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