Here's Why You Should Retain Integer Holdings Stock in Your Portfolio

Integer Holdings Corporation ITGR has been gaining from its research and product development activities. The optimism, led by a solid third-quarter 2024 performance and its solid foothold in the broader MedTech space, is expected to contribute further. However, dependence on third-party suppliers raises concern.This Zacks Rank #3 (Hold) company’s shares have risen 36% in the last year compared with the industry’s  5.3% rise and the S&P 500’s 26.4% growth.The renowned medical device outsourcing manufacturer has a market capitalization of $4.52 billion. The company projects 12.8% growth for the next five years and expects to maintain its strong performance going forward. Integer Holdings’ earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 3.88%.Image Source: Zacks Investment ResearchReasons Favoring Integer Holdings’ GrowthResearch and Product Development: Investors have a positive outlook on Integer Holdings, recognizing its strong role in developing and manufacturing medical devices and components. The company is dedicated to creating new products, refining and enhancing existing ones, and exploring new or related applications for its products.Beyond its internal efforts to advance technology and capabilities, Integer Holdings collaborates with external research institutions on unique technology projects to offer innovative solutions to its customers.Divestiture of Non-Medical Business: In September, Integer Holdings entered into an agreement to divest its Electrochem business to Ultralife Corporation. Ultralife is acquiring Electrochem for $50 million in cash, subject to customary working capital adjustments. The transaction closed in November. The divestiture of Electrochem represents a sale of the company’s previously reported Non-Medical segment, as the Electrochem business constituted substantially all the assets and liabilities and operations reported in the Non-Medical segment.Per Integer Holdings’ management, the divestiture of the Non-Medical business is another step toward managing its portfolio to accomplish the company’s strategic financial objectives. Following the transaction, Integer Holdings became a medical business with additional cash to pay down debt and execute its inorganic growth strategy. Management expects to utilize the additional capital to be received following the divestiture to invest in capabilities and capacity that support its targeted growth markets.Strong Q3 Results: Integer Holdings’ robust third-quarter 2024 results raise optimism. The company registered year-over-year top-and-bottom-line growth. Robust performances by the Medical segment and strength in all the product lines of the Medical segment were encouraging. The expansion of both margins bodes well for the stock. Integer Holdings continued to benefit from strong demand across all markets and the InNeuroCo and Pulse acquisitions. These also look promising for the stock.A Factor That May Offset ITGR’s GainsDependence on Third-Party Suppliers: Integer Holdings’ business depends on a continuous supply of raw materials, which may be susceptible to fluctuations due to transportation issues, government regulations and price controls, among others. Significant increases in the cost of raw materials, which cannot be recovered through increases in the prices of the company’s products, could adversely impact its operational results.Estimate TrendInteger Holdings is witnessing a negative estimate revision trend for 2024. In the past 60 days, the Zacks Consensus Estimate for earnings has moved 1 cent south to $5.33 per share.The Zacks Consensus Estimate for the company’s fourth-quarter 2024 revenues is pegged at $446.5 million, indicating an 8.1% rise from the year-ago quarter’s reported number. The consensus mark for fourth-quarter earnings is pegged at $1.45 per share, reflecting 4.3% growth from the year-earlier level.Stocks to ConsiderSome better-ranked stocks in the broader medical space are Masimo MASI, Accuray ARAY and Abbott Laboratories ABT.Masimo, carrying a Zacks Rank #2 (Buy) at present, has an estimated growth rate of 11.8% for 2025. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.MASI’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 17.10%. Its shares have risen 31.7% against the industry’s 1% decline in the past six months.Accuray, carrying a Zacks Rank #2 at present, has an estimated growth rate of 1200% for 2025. Its earnings missed estimates in three of the trailing four quarters and met in one, delivering an average negative surprise of 141.97%.ARAY’s shares have gained 8.8% against the industry’s 1% decline in the past six months.Abbott, carrying a Zacks Rank of 2 at present, has an estimated earnings growth rate of 10% for 2025. It delivered a trailing four-quarter average earnings surprise of 1.64%.ABT’s shares have risen 8.5% in the past six months compared with the industry’s 7.2% growth.Zacks Naming Top 10 Stocks for 2025Want to be tipped off early to our 10 top picks for the entirety of 2025?History suggests their performance could be sensational.From 2012 (when our Director of Research Sheraz Mian assumed responsibility for the portfolio) through November, 2024, the Zacks Top 10 Stocks gained +2,112.6%, more than QUADRUPLING the S&P 500’s +475.6%. Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2025. Don’t miss your chance to get in on these stocks when they’re released on January 2.Be First to New Top 10 Stocks >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Abbott Laboratories (ABT): Free Stock Analysis Report Accuray Incorporated (ARAY): Free Stock Analysis Report Masimo Corporation (MASI): Free Stock Analysis Report Integer Holdings Corporation (ITGR): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks