From NASDAQ:

The MedTech companies within the Medical sector have seen a year-over-year decline in earnings due to ongoing macroeconomic headwinds and inflation. Earnings of the majority of the companies are expected to have declined in the fourth quarter. On a positive note, Globus Medical, Glaukos Corporation, and PROCEPT BioRobotics are expected to beat earnings estimates. The overall fourth-quarter results in the Medical sector are expected to reflect a decline in earnings despite revenue growth.

The global sales in the legacy Transcatheter Aortic Valve Replacement product group of Edwards Lifesciences improved 13% year over year, while Quest Diagnostics saw a 79.9% decline in COVID-19 testing revenues. However, both companies faced challenges related to rising costs and expenses, putting pressure on margins.

According to the latest Earnings Preview, the Medical sector has seen a decline in earnings year over year, with 67.6% of companies beating both earnings and revenue estimates, and overall earnings plunging 18.2% despite a 6.3% revenue growth. The IMF has predicted a global economic deceleration due to central bank policy rates to fight inflation and the gradual withdrawal of fiscal policies.

Globus Medical, Glaukos, and PROCEPT BioRobotics are expected to beat earnings estimates in this reporting cycle due to strong market share gain and commercial success of their products. Despite the uncertain macro environment, all three companies have a positive Earnings ESP and a Zacks Rank, raising the possibility of an earnings surprise in the to-be-reported quarter. Globus Medical is slated to release results on Feb 20, Glaukos on Feb 21, and PROCEPT BioRobotics on Feb 27.

Each company’s positive Earnings ESP and a Zacks Rank #3 indicates strong potential for an earnings surprise in the fourth quarter. Globus Medical, Glaukos Corporation, and PROCEPT BioRobotics are expected to outperform in their respective segments.



Read more: 3 Medtech Stocks Likely to Top Estimates This Earnings Season