Reiterate Mindray at Neutral - Analyst Blog
13 Marzo 2013 - 3:30PM
Zacks
On Mar 8, 2013, we retained
Mindray Medical International Limited (MR) at
Neutral after the company beat Zacks Consensus Estimates for
earnings and revenue for fourth quarter 2012.
Why the
Retention?
Mindray released its results for
the fourth quarter on Feb 25. The company posted adjusted earnings
per share of 49 cents per share, better than the Zacks Consensus
Estimate of earnings of 48 cents a share. Revenues in the reported
quarter surged 19.7% year over year to $316.1 million, beating the
Zacks Consensus Estimate of $304 million.
Over the past 30 days, the Zacks
Consensus Estimate for 2013 has moved up by 8 cents to $2.05. For
2014, the Zacks Consensus Estimate has increased by 5 cents to
$2.29 during the same timeframe.
Mindray provides guidance on a full
year basis. The company forecasts revenue growth of 17% or more for
2013. MR also expects adjusted net income for the year to increase
by a minimum of 15% year over year. The guidance does not take into
account any tax advantage on account of software business status
during 2011 and 2012, which might be received in 2013. The guidance
incorporates an income tax rate of 15% for the Shenzhen
subsidiary.
Mindray is a bellwether in the
Chinese MedTech industry with a solid international presence. A key
distinction with domestic competitors is that the majority of
Mindray’s products have CE Mark and/or Food and Drug Administration
(FDA) clearance.
Mindray maintains a decent product
pipeline and brings out several new products each year. New
products contribute in a major way to Mindray’s revenues. In 2012,
the company launched 10 new products and acquired four
companies.
The company has entered the premium
segment globally, where its competitive advantage is still unclear.
Also, on the negative side, health care reforms in China and the
U.S. may reduce demand for Mindray’s products. Competition is
fierce and leads to price erosion over time.
Other Stocks to
Consider
We currently have a Zacks Rank #2
(Buy) on Mindray. Cyberonics Inc. (CYBX) and
Given Imaging Ltd. (GIVN) carry a Zacks Rank #1
(Strong Buy) and are expected to do well.
CYBERONICS INC (CYBX): Free Stock Analysis Report
GIVEN IMAGING (GIVN): Free Stock Analysis Report
MINDRAY MEDICAL (MR): Free Stock Analysis Report
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