CONMED Corporation (CNMD): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report


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CONMED's 2014-second quarter earnings of $0.47 per share rose 9.3% but missed the Zacks Consensus Estimate by a penny. However, revenues continue to fall. In the quarter it fell 2.5% on weaker sales of General Surgery devices, Surgical Visualization capital products and the discontinuance of the Cascade PRP product line. The company lowered its revenues and earnings guidance for 2014. CONMED is benefiting from the increasing trend of using minimally invasive techniques. Its broader line of surgical products is expected to boost revenues. As such, we maintain our Neutral recommendation with a target of $42.00.


Headquartered in Utica, N.Y., CONMED Corporation (CNMD) is a major medical products manufacturer specializing in surgical instruments and devices. Approximately 60% of the company's revenues are derived from products designed for the orthopedic surgery markets of arthroscopy and powered surgical instruments. CONMED markets its arthroscopy, multi-specialty endoscopic medical video systems, and powered surgical instruments through its Linvatec unit.

The company also sells products for general and other surgical specialties such as electrosurgery systems for all types of surgery, and endosurgery instruments for minimally invasive laparoscopic surgery. Patient Care products, including ECG electrodes for heart monitoring and pulse oximetry for blood oxygenation monitoring, are provided for various clinical settings.

CONMED has 3,600 employees and several manufacturing facilities. The company distributes its products globally through its own sales network in the U.S. and internationally. It also distributes its products through specialty distributors in certain international markets. International revenues contributed roughly 52% of total sales in the first quarter of 2014.

Last year, CONMED combined its various segments to form three categories viz. orthopedic surgery (56.3% of total sales in the first half of 2014), general surgery (36.3%) and surgical visualization (7.4%). The reshuffling became necessary after the acquisition of Viking, which the company acquired in 2012.

The orthopedic surgery product line includes CONMED's sports medicine instrumentation and small bone, large bone and specialty powered surgical instruments. General surgery consists of a complete line of endo-mechanical instrumentation for minimally invasive laparoscopic and gastrointestinal procedures, a line of cardiac monitoring products as well as electrosurgical generators and related instruments. The surgical visualization business includes all of CONMED's 2D and 3D imaging devices.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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