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Nevro (NVRO) Q4 Loss Narrower Than Expected, Revenues Up Y/Y

Zacks Equity Research

Nevro Corp. NVRO reported fourth-quarter 2019 loss of 44 cents per share, narrower than the Zacks Consensus Estimate of a loss of 62 cents. The company had incurred a loss of 32 cents in the year-ago quarter.

For 2019, Nevro Corp.’s loss per share was $3.37, narrower than the Zacks Consensus Estimate of a loss of $3.46. This compares to the year-ago quarter’s loss of $1.64.

The Zacks Rank #1 (Strong Buy) company posted revenues of $114.4 million, which surpassed the Zacks Consensus Estimate by 3.2%. The figure also rose 6% year over year.

Revenues in 2019 totaled $390.3 million, up 0.8%. The metric surpassed the Zacks Consensus Estimate of $387.4 million.

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Quarter Highlights

In the quarter under review, international revenues were $16.5 million, up 1% year over year and 3% at constant currency.

U.S. revenues for the quarter totaled $97.9 million, up 7% year over year. Per management, revenues gained from the 17% year-over-year growth in U.S. trials and 20% increase in permanent implant.

Nevro Corp. Price, Consensus and EPS Surprise

 

Nevro Corp. Price, Consensus and EPS Surprise
Nevro Corp. Price, Consensus and EPS Surprise

Nevro Corp. price-consensus-eps-surprise-chart | Nevro Corp. Quote

Margins

Gross profit totaled $81.3 million, up 6.7% year over year. Gross margin was 71%, up 50 basis points.

Operating expenses rose 9.7% year over year to $92.9 million. Research and development expenses totaled $16.9 million, up 25.6%.

Sales, general and administrative expenses rose 6.6% to $76 million.

Loss from operations was $11.7 million, compared with a loss of $8.6 million in the year-ago quarter.

Guidance

Nevro Corp. expects 2020 revenues within $435-$440 million. The Zacks Consensus Estimate for the same is pegged at $437.9 million.

Gross margin is projected in the range of 69-70% and operating expenses are expected at around $355 million.

Summary

Nevro Corp exited the fourth quarter on a strong note. The company’s domestic and international revenues surged on a year-over-year basis. Also, demand for implants drove the solid quarterly show. The commercial launch of the Senza Omnia SCS System buoys optimism. A strong guidance for 2020 holds promise. Expansion in gross margin is heartening.

On the flip side, increased operating expenses raise concern.

Earnings of Other MedTech Majors at a Glance

Other top-ranked companies, which reported solid results this earnings season, include Stryker Corporation SYK, Accuray Incorporated ARAY and IDEXX Laboratories, Inc. IDXX. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stryker reported fourth-quarter 2019 adjusted earnings per share (EPS) of $2.49, outpacing the Zacks Consensus Estimate by 1.2%. Revenues of $4.13 billion surpassed the consensus estimate by 0.7%. The company carries a Zacks Rank #2 (Buy).

Accuray reported second-quarter fiscal 2020 adjusted EPS of a penny against the Zacks Consensus Estimate of a loss of 7 cents. Net revenues of $98.8 million outpaced the Zacks Consensus Estimate by 0.3%. The company sports a Zacks Rank #1.

IDEXX Laboratories reported fourth-quarter 2019 adjusted EPS of $1.04, which beat the Zacks Consensus Estimate of 91 cents by 14.3%. Revenues were $605.4 million, surpassing the Zacks Consensus Estimate by 0.9%. The company carries a Zacks Rank of 2.

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Stryker Corporation (SYK) : Free Stock Analysis Report
 
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