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
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
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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