Advertisement
Australia markets open in 8 hours 19 minutes

  • ALL ORDS

    7,898.90
    +37.90 (+0.48%)
     

  • AUD/USD

    0.6435
    -0.0002 (-0.03%)
     

  • ASX 200

    7,642.10
    +36.50 (+0.48%)
     

  • OIL

    82.80
    +0.11 (+0.13%)
     

  • GOLD

    2,399.30
    +10.90 (+0.46%)
     

  • Bitcoin AUD

    98,950.16
    +4,973.43 (+5.29%)
     

  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     

Here's Why You Should Add Surmodics to Your Portfolio Now

Zacks Equity Research
·4-min read

Surmodics, Inc. SRDX is gaining on regulatory clearances and prudent acquisitions.Consistent R&D efforts have also been a key growth driver.

The company, with a market capitalization of $505.3 million, is a leading provider of medical device and In Vitro Diagnostics (IVD) technologies to the healthcare industry. The company’s earnings are expected to improve 10% over the next five years. Also, this Zacks Rank #1 (Strong Buy) company has a trailing four-quarter positive earnings surprise of 163.1%, on average.

In the past three months, the stock has gained 4.8% compared with the 0.2% growth of its industry.

Let’s delve deeper into the factors working in favor of the company.

ADVERTISEMENT

Consistent Efforts to Boost R&D: Surmodics’ solid efforts to improve research and development have been a key growth driver. The company’s whole product solutions pipeline and Sirolimus-based below-the-knee DCB program deserve a mention here. Surmodics has been making progress with its internally-developed .014 balloon platform. During fiscal 2020, the company expects to initiate a first-in-human clinical study for its Sundance below-the-knee sirolimus drug-coated balloon and advance development efforts on several products, including those related to its POUNCE thrombectomy and Sublime radial access platforms. Moreover, the company continues to make significant progress when it comes to its other radial access therapeutic devices, including the 0.18 transradial PTA balloon catheter.

Regulatory Approvals: During first-quarter fiscal 2020, the company’s Sirolimus-coated balloon, Sundance was granted breakthrough device designation by the FDA. The company’s radial artery access and thrombectomy platforms have also been showing good progress. The company is committed toward accelerating the development of these platforms and expects to submit at least three new devices for 510(k) clearance during fiscal 2020.



Moreover, the company continues to target regulatory clearance for POUNCE by late third-quarter fiscal 2020. The company made an active submission for the 510(k) FDA clearance during the fiscal second quarter. Additionally, the company expects to secure 510(k) clearance for its 2.5 meter Sublime .014" transradial PTA balloon catheter by third-quarter fiscal 2020.

In the fiscal second quarter, the company attained CE mark clearance for Telemark coronary/peripheral support microcatheter. It continues to progress with its radial platform and has filed for FDA approval for its .014” radial balloon catheter. These balloon catheters, which will be launched in the United States later in 2020, can be used to help patients suffering from below-the-knee critical limb ischemia.

Acquisitions and Partnerships: Surmodics has made several acquisitions over the last few years, which have not only diversified its revenue base but also expanded its customer base.Management is upbeat about the recently-inked partnership with Cook Medical for commercialization of .014” and .018” low-profile PTA balloon catheters.

These deals have bolstered Surmodics’ capability to support key projects and strengthened the technical and business management teams.

Estimates Trend

The company is witnessing a positive estimate revision trend for fiscal 2020 earnings. Over the past 30 days, the Zacks Consensus Estimate for the same has risen to 5 cents per share from a loss of 17 cents per share.

The Zacks Consensus Estimate for third-quarter fiscal 2020 revenues is pegged at $18.3 million, suggesting a 24.8% fall from the year-ago reported number.

Other Key Picks

A few other top-ranked stocks from the broader medical space are Aphria APHA, DexCom DXCM and HMS Holdings HMSY.

Aphria’s long-term earnings growth rate is estimated at 24.6%. The company presently carries a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.

DexCom’s long-term earnings growth rate is estimated at 36.3%. The company presently carries a Zacks Rank #2.

HMS Holdings’ long-term earnings growth rate is estimated at 10%. It currently carries a Zacks Rank #2.

Biggest Tech Breakthrough in a Generation

Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.

A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.

See 8 breakthrough stocks 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
 
DexCom, Inc. (DXCM) : Free Stock Analysis Report
 
Surmodics, Inc. (SRDX) : Free Stock Analysis Report
 
HMS Holdings Corp (HMSY) : Free Stock Analysis Report
 
Aphria Inc. (APHA) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.