Stryker (NYSE:SYK) reported fourth-quarter results that beat The Street, predicting up to 8.5% organic sales growth in the new year.
CEO Kevin Lobo also had a timeline of future application launches for the ortho device giant’s popular Mako robotic surgery system.
The results, posted yesterday evening, sent SYK shares up more than 6% to $271.26 apiece by midday trading today.
The Kalamazoo, Michigan–based company earned $563 million, or $1.47 per share, off of $5.2 billion in sales for the quarter that ended Dec. 31, 2022. The results represented a bottom-line slide of 15.0% compared with Q4 2021. However, sales were up 10.7.
Adjusted to exclude one-time items, EPS were $3. The amount was 16¢ ahead of Wall Street expectations, where analysts predicted EPS of $2.84 and sales of $4.96 billion.
“We delivered outstanding organic sales growth in the fourth quarter, driven by strong commercial execution and improved supply,” Lobo said in a news release. “We expect continued positive sales momentum in 2023 and for adjusted earnings to gradually improve over the course of the year.”
MedSurg and Neurotechnology sales in Q4 were $3.1 billion, up 15.6% year over year. Orthopaedics and Spine sales were $2.2 billion, up 4.3%.
Stryker is experiencing good momentum — and building excitement around Mako
Stryker officials expect the company to experience more macroeconomic volatility in 2023. Their earnings release mentioned alleviating supply chain disruptions, inflationary risks and currency fluctuations.
But despite the uncertainty, Stryker also reported good momentum in many parts of its business heading into 2023. The company is predicting organic net sales growth of 7–8.5% and adjusted EPS of $9.85–10.15 in 2023. (Analysts, on average, have predicted EPS of $9.86 for the full-year 2023.)
BTIG analysts stuck with their Buy rating for Stryker stock. Their note had the subhead: “ABC … Always Be Closing.”
“EPS is showing little to no leverage relative to organic growth, but we think as SYK moves through the year, the combination of a robust product cadence, improving procedural dynamics, a strong order book, and expense control puts SYK in a position to show upside,” said BTIG’s Ryan Zimmerman and Sam Durno.
The BTIG analysts also noted that there should be growing excitement this year around the future expansion of applications around Stryker’s popular Mako line of ortho surgery robots.
Lobo reported good progress around new Mako applications during the company’s earnings call. The company expects Mako Spine to initially launch in the second half of 2024, with Mako Shoulder out by the end of 2024.’
“What gives us confidence is our prototypes are built,” Lobo said. “We have tested it with surgeons. We have gotten feedback. We have had some meetings in one case with the agency to get an idea on the regulatory pathway.”
This story originally ran on Jan. 31, 2022. Updated Feb. 1 with the next-day stock price, and analyst comment.
