Should You Buy, Sell, or Hold GE Healthcare Before Q1 Earnings?

GE HealthCare Technologies Inc. GEHC is scheduled to report first-quarter 2025 results on April 30, before market open.In the last reported quarter, the company’s adjusted earnings per share of $1.45 beat the Zacks Consensus Estimate by 15.1%.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Let us look at how things have shaped up for GEHC prior to the announcement.Factors That Might Have Driven GEHC’s Q1 PerformanceGE HealthCare is poised to benefit from ongoing robust procedure volumes across its Imaging and Ultrasound businesses in the first quarter of 2025. During its fourth quarter 2024 earnings call, the company highlighted that procedure volumes, particularly in the United States, continued to experience healthy growth, driven by expanding outpatient imaging centers and a strong rebound in surgical and interventional procedures. The trend is fueled by rising demand for diagnostic imaging services such as MRI, CT scans, ultrasound, and interventional cardiology solutions. GEHC's Advanced Visualization Solutions (AVS) also benefited from increased procedure volumes, notably within interventional cardiology and surgical imaging platforms like the OEC 3D system. Moreover, the cath lab product Allia IGS Pulse significantly outperformed expectations, supported by strong clinical adoption in structured heart and orthopedic procedures.This favorable backdrop in procedural growth not only boosts equipment sales but also drives recurring service revenues, strengthening GEHC’s overall revenue mix. The company's strong backlog and a record book-to-bill ratio of 1.09 exiting 2024 further indicate sustained demand momentum heading into early 2025. These dynamics are expected to partially offset macro pressures from international markets, particularly China, where sales recovery remains gradual.However, China continues to present headwinds for GE HealthCare Technologies as the company navigates a slow and uneven recovery in the region. During the fourth quarter of 2024 earnings call, management confirmed that although order trends in China showed early signs of improvement, actual revenue growth remains subdued. GEHC expects China sales to decline in the low single digits for 2025, with the first half, including the first quarter, reflecting negative growth.During the first quarter, GE HealthCare has advanced its precision care strategy with innovations like the upcoming launch of Flyrcado, a radiopharmaceutical for cardiovascular PET imaging, and strengthened its AI capabilities, increasing FDA-authorized AI solutions from 58 to 85. The company has also expanded cloud-based solutions like CareIntellect to streamline clinical workflows. Key partnerships include a $1 billion, seven-year Care Alliance with Sutter Health to transform care for 3.5 million patients and a long-term agreement with Nuffield Health in the UK. GEHC’s acquisition of NMP aims to expand its radiopharmaceutical distribution in Japan and Asia, positioning the company as a comprehensive healthcare solutions provider focused on growth and margin expansion.GEHC’s Segmental OverviewIn the fourth quarter of 2024, GEHC’s Imaging segment witnessed flat year-over-year revenues, impacted by sluggish demand in China. However, the U.S. market remained robust, driven by investments in PET and CT systems. The segment's EBIT margin improved 19% year over year, reflecting favorable pricing and product mix. For the first quarter of 2025, Imaging is expected to continue as a core revenue driver, benefiting from ongoing demand for imaging replacements and upgrades, especially in the United States, and expansion in theranostics. Despite challenges in China, backlog conversion and pricing strategies should help stabilize performance.Advanced Visualization Solutions (AVS), previously part of the ultrasound segment, achieved $1.44 billion in revenues in the fourth quarter of 2024, with a 4% organic growth year over year. This growth was driven by increased sales in the United States, particularly in interventional cardiology and surgical imaging platforms like the OEC 3D system. The segment's EBIT margin rose 15% year over year. Looking ahead to the first quarter of 2025, AVS is anticipated to maintain strong performance, supported by continued demand for advanced imaging technologies and new product introductions.Patient Care Solutions (PCS) posted flat organic growth year over year in the fourth quarter of 2024. The segment's EBIT margin declined 4% year over year, due to inflation and portfolio mix, partially offset by productivity actions. In the first quarter of 2025, PCS is expected to see moderate growth, bolstered by increased demand for patient monitoring and respiratory care systems, especially in the United States.Pharmaceutical Diagnostics (PDx) was a standout performer, with 9% organic revenue growth in the last reported quarter, driven by increased procedure volumes. PDx is expected to show strong organic revenue growth in the first quarter of 2025, driven by increased procedure volumes and favorable pricing trends. The launch of Ocado, the FDA-approved PET tracer for coronary artery disease, is set to drive long-term growth. Favorable reimbursement trends in PET diagnostics should further boost revenues in this high-margin segment. While macroeconomic pressures and currency headwinds may slightly impact growth, the recovery of global elective procedures and supply chain stabilization should support continued strong performance.GE HealthCare Technologies Inc. Price and EPS Surprise GE HealthCare Technologies Inc. price-eps-surprise | GE HealthCare Technologies Inc. QuoteQ1 EstimatesThe Zacks Consensus Estimate for revenues is pegged at $4.66 billion, implying growth of 0.2% year over year.The Zacks Consensus Estimate for earnings per share is pinned at $0.91, suggesting an improvement of 1.1% from the prior-year level.What the Zacks Model UnveilsOur proven model does not conclusively predict an earnings beat for GEHC this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the chances of an earnings beat. This is not the case here, as you will see below.Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.Zacks Rank: The company carries a Zacks Rank #3 at present.GEHC’s Long-Term Growth PotentialGE HealthCare Technologies is poised for a dynamic 2025, driven by strategic initiatives and ongoing market challenges. New product launches are playing a crucial role in shaping the company’s growth trajectory, particularly in imaging and pharmaceutical diagnostics. Ocado, GEHC’s newly FDA-approved PET tracer for coronary artery disease, is expected to drive long-term expansion in the high-margin pharmaceutical diagnostics segment. Additionally, the integration of AI-powered imaging solutions is enhancing efficiency, positioning GEHC at the forefront of healthcare innovation.???Margin expansion and cost optimization continue to be priorities. The company has implemented various initiatives, including product platforming and supply-chain efficiencies, to sustain profitability. As demand for capital equipment fluctuates, especially in international markets, these efforts help mitigate financial volatility. AI integration in capital equipment, particularly in imaging and advanced visualization, is improving workflow efficiency and enhancing the overall value proposition for healthcare providers.???The pharmaceutical diagnostics segment remains a strong growth driver, with increased procedure volumes expected to sustain revenue gains. Favorable reimbursement trends, particularly for PET diagnostics, could further accelerate adoption. Meanwhile, capital equipment sales are supported by ongoing investments in AI and digital tools, which improve operational efficiency and expand GEHC’s market share.???Despite these positive factors, challenges in the Chinese market remain a significant concern. Economic headwinds and delayed stimulus funding continue to impact purchasing behavior, potentially weighing on overall revenue growth in 2025. However, GEHC’s diversified global presence and strong U.S. performance provide a buffer against these uncertainties. With prudent cost management, continued innovation, and a balanced approach to international markets, GEHC is well-positioned for sustainable growth in 2025 and beyond.Our Take on GEHCGEHC’s shares have lost 12.5% in the year-to-date period against the industry’s growth of 2.8%. The underperformance can be attributed to challenges in China, which are putting pressure on top-line growth and uncertainty relating to tariffs.The company’s challenges may lead to mixed performance going forward. Per the Zacks Style Score, a proprietary method for evaluating stocks, the company looks moderately valued (Value Score: B) with a strong chance of continued uptrend (Growth Score: B). The pace is likely to be strong as well (Momentum Score: B).As the Zacks Rank, coupled with the style score for GEHC, does not conclusively predict that the company may beat on earnings this reporting cycle, we caution against any new investment bet in GEHC at present. Those who have already invested in the stock may sell a portion of their investments and book profits.Image Source: Zacks Investment ResearchStocks Worth a LookHere are some medical stocks worth considering, as these have the right combination of elements to post an earnings beat this time:ANI Pharmaceuticals ANIP has an Earnings ESP of +0.86% and a Zacks Rank #1. The company is slated to release first-quarter 2025 results on May 9. You can see the complete list of today’s Zacks #1 Rank stocks here.ANIP’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 17.32%. The Zacks Consensus Estimate for the company’s first-quarter EPS is expected to increase 30.6% from the year-ago quarter figure.Cencora COR has an Earnings ESP of +0.91% and a Zacks Rank #2. The company is slated to release first-quarter fiscal 2025 results on May 7.The company’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 4.94%. The Zacks Consensus Estimate for COR’s fiscal first-quarter EPS is expected to rise 7.1% from the year-ago reported figure.Hims & Hers Health HIMS has an Earnings ESP of +115.69% and a Zacks Rank #2. The company is slated to release first-quarter 2025 results on May 5.HIMS’ earnings surpassed estimates in three of the trailing four quarters and missed on one occasion, the average surprise being 40.42%. The Zacks Consensus Estimate for Hims & Hers Health’s first-quarter EPS is expected to increase 180% from the year-ago quarter figure.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.9% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>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 Cencora, Inc. (COR): Free Stock Analysis Report ANI Pharmaceuticals, Inc. (ANIP): Free Stock Analysis Report Hims & Hers Health, Inc. (HIMS): Free Stock Analysis Report GE HealthCare Technologies Inc. (GEHC): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks