Healthcare solutions provider Solventum (NYSE:SOLV) will be reporting results tomorrow afternoon. Here’s what to look for.
Solventum beat analysts’ revenue expectations by 1.4% last quarter, reporting revenues of $2.08 billion, flat year on year. It was a very strong quarter for the company, with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ full-year EPS guidance estimates.
Is Solventum a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Solventum’s revenue to be flat year on year at $2.05 billion, in line with the 1.5% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.32 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Solventum has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time since going public by 1.8% on average.
Looking at Solventum’s peers in the surgical equipment & consumables - diversified segment, some have already reported their Q4 results, giving us a hint as to what we can expect. BD delivered year-on-year revenue growth of 9.8%, beating analysts’ expectations by 1.2%, and STERIS reported revenues up 5.6%, falling short of estimates by 0.6%. BD traded down 7.3% following the results while STERIS was up 2.1%.
Read our full analysis of BD’s results here and STERIS’s results here.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market has been optimistic as of late due to a soft landing. This is an economic situation where rate hikes successfully quelled inflation but did not send the economy into a recession. Furthermore, recent rate cuts and Donald Trump's triumph in the 2024 Presidential election have been tailwinds for the market, and while some of the surgical equipment & consumables - diversified stocks have shown solid performance, the group has generally underperformed, with share prices down 4.4% on average over the last month. Solventum is up 11.6% during the same time and is heading into earnings with an average analyst price target of $74.39 (compared to the current share price of $83.55).
When a company has more cash than it knows what to do with, buying back its own shares can make a lot of sense–as long as the price is right. Luckily, we’ve found one, a low-priced stock that is gushing free cash flow AND buying back shares. Click here to claim your Special Free Report on a fallen angel growth story that is already recovering from a setback.
