Teleflex Stock Rises on Q4 Earnings Beat, Gross Margin Crashes

Teleflex Incorporated TFX posted fourth-quarter 2024 adjusted earnings per share (EPS) from continuing operations of $3.89, up 15.1% from the year-ago quarter’s figure. The metric topped the Zacks Consensus Estimate by 0.8%.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.GAAP loss per share was $2.95 compared to EPS of $0.66 in the prior-year period.The full-year adjusted EPS from continuing operations was $14.01, up 3.6% year over year. The figure topped the Zacks Consensus Estimate by 0.2%.Following the announcement, shares of the company rose 0.6% in yesterday’s after-market trading. TFX’s RevenuesNet revenues rose 2.8% year over year (up 3.2% at constant exchange rate or CER) to $795.4 million. However, the metric missed the Zacks Consensus Estimate by 2.2%.Full-year 2024 net revenues were $3.05 billion, up 2.4% year over year. The figure missed the Zacks Consensus Estimate by 1%. Segmental Analysis of TFX’s Q4 RevenuesTeleflex has three reportable segments: Americas, EMEA (Europe, the Middle East and Africa) and Asia (Asia Pacific).Net revenues in the Americas were $540.8 million, which increased 1.4% from the year-ago period’s level (up 1.7% at CER). This compares with our model’s projection of $472.1 million for the fourth quarter.The EMEA (Europe, the Middle East and Africa) net revenues of $161 million increased 5.7% year over year (up 6% at CER). Our model projected revenues of $162.9 million for the fourth quarter. Revenues from Asia (Asia Pacific) rose 5.9% to $93.6 million (up 7.5% at CER). Our model’s projection was $89.7 million.During the reported quarter, TFX incorporated the OEM (Original Equipment Manufacturer and Development Services) reporting unit into the Americas segment.TFX’s Q4 Product Revenues in DetailIn the fourth quarter, the Vascular Access segment recorded net revenues of $189.3 million, up 1.8% year over year at CER. This compares with our model’s projection of $194.5 million.The Interventional business registered net revenues of $160.4 million, up 18.7% year over year at CER. This compares with our model’s projection of $153.8 million.Within the Anesthesia segment, net revenues decreased 2.4% year over year at CER to $95.3 million. This compares with our model’s projection of $102.9 million.The Surgical segment recorded net revenues of $121.9 million, up 12.3% year over year at CER. Our model’s projection was $119.4 million.Revenues from the Interventional Urology segment totaled $84.9 million, down 8.6% year over year at CER. This compares with our model’s projection of $100 million.OEM recorded revenue growth of $85.4 million, up 3.6% year over year at CER. This compares with our model’s projection of $88.5 million.The Other product segment’s (consisting of the company’s respiratory products not included in the divestiture to Medline, manufacturing service agreement revenues and Urology Care products) net revenues of $58.2 million registered a year-over-year decline of 14.3% at CER. This compares with our model’s projection of $54.2 million for the quarter.TFX’s Margin PerformanceIn the reported quarter, the gross profit totaled $439.5 million, up 2% year over year. The gross margin contracted 44 basis points (bps) to 55.3% due to a 3.8% rise in the cost of goods sold.Overall, the adjusted operating profit was $140.8 million, up 4.4% year over year. The adjusted operating margin expanded 27-bps to 17.7%.TFX’s Liquidity PositionTeleflex exited 2024 with cash and cash equivalents of $290.2 million compared with $222.8 million at the end of 2023.  Teleflex Incorporated Price, Consensus and EPS Surprise Teleflex Incorporated price-consensus-eps-surprise-chart | Teleflex Incorporated QuoteCumulative cash flow provided by operating activities from continuing operations was $638.3 million compared with $511.7 million in the year-ago period.Teleflex’s 2025 GuidanceGAAP revenue growth for 2025 is expected to be in the range of (0.4%) to 0.7%. The Zacks Consensus Estimate for total revenues is pegged at $3.22 billion.Teleflex anticipates adjusted EPS from continuing operations to be in the range of $13.95-$14.35. The Zacks Consensus Estimate for EPS is pegged at $15.18.Our Take on TFXTeleflex exited the fourth quarter of 2024 on a mixed note, wherein earnings beat estimates but revenues missed the same. All the reportable business segments performed well during the quarter. Interventional and Surgical businesses performed well with double-digit adjusted constant currency growth. However, the top line growth was partially offset by declining sales within the Interventional Urology business unit. The remaining revenue shortfall was due to lower year-over-year hospitalizations due to flu and COVID-19 impacting the CVC business negatively within the Vascular business unit. Meanwhile, a contraction of the adjusted gross margin does not bode well for the stock. On a positive note, Teleflex has entered into a definitive agreement to acquire substantially all of the Vascular Intervention business by BIOTRONIK SE & Co. KG. With the acquisition of BIOTRONIK products, Teleflex will gain meaningful scale, expand its presence in the cath lab and be poised for continued growth. The product portfolio includes a broad suite of vascular intervention devices such as drug-coated balloons, drug-eluting stents, covered stents balloon and self-expanding bare metal stents and balloon catheters.TFX’s Zacks Rank and Key PicksTeleflex currently carries a Zacks Rank #4 (Sell).Some better-ranked stocks from the broader medical space are ResMed RMD, Cardinal Health CAH and Insulet PODD.ResMed reported a second-quarter fiscal 2025 adjusted EPS of $2.43, which topped the Zacks Consensus Estimate by 5.6%. Revenues of $1.28 billion exceeded the Zacks Consensus Estimate by 1.6%. RMD carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.RMD has an estimated fiscal 2025 earnings growth rate of 21.9% compared with the industry’s 13.2%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.9%.Cardinal Health, carrying a Zacks Rank #2 at present, posted a second-quarter fiscal 2025 adjusted EPS of $1.93, which outpaced the Zacks Consensus Estimate by 10.3%. Revenues of $55.26 billion exceeded the Zacks Consensus Estimate by 0.7%.CAH has an estimated five-year earnings growth rate of 10.7% compared with the industry’s 9.3%. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.Insulet, presently carrying a Zacks Rank #2, posted a fourth-quarter 2024 adjusted EPS of $1.15, which topped the Zacks Consensus Estimate by 9.5%. Revenues of $597.5 million exceeded the Zacks Consensus Estimate by 2.7%.PODD has an estimated long-term earnings growth rate of 20.3% compared with the industry’s 15.5%. Its earnings surpassed estimates in three of the trailing four quarters and missed in one, the average surprise being 27.5%.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 +24.3% 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 Cardinal Health, Inc. (CAH): Free Stock Analysis Report ResMed Inc. (RMD): Free Stock Analysis Report Teleflex Incorporated (TFX): Free Stock Analysis Report Insulet Corporation (PODD): 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