) reached a 52-week high on October 8, 2012, riding on growing
demand from hospitals for its single-use medical devices. This
Zacks #2 Rank (Buy) has registered an earnings surprise in three of
the last four quarters, and will report again before this month is
over. It has also maintained a steady dividend stream for more than
A Mixed Quarter
On July 31, Teleflex reported second quarter adjusted earnings per
share of $1.14, which beat the Zacks Consensus Estimate by 3.6%.
Revenues rose 0.6% year over year (up 4.7% in constant currency) to
$383.3 million, but missed the Zacks Consensus Estimate by 5.3%.
Among the major segments, Critical Care reported revenues of $254.1
million, up 0.2% (up 4.4% in constant currency) and Surgical Care
stated sales of $72.5 million, down 0.5% (up 3.8% in constant
The company reported gross margin of 48.1% versus 47.6% a year ago.
Operating margin was up to 16.9% from 14.7% in the year-ago
The company left its guidance unchanged for 2012. It is expected to
report third quarter results on October 31, 2012.
Solid Dividend Yield
Teleflex has consistently maintained a dividend of 34 cents per
quarter for the last 18 quarters. Currently, the stock offers a
healthy dividend yield of 2.0%. The payout stands at about 32%.
Earnings Estimates Inch Up
The Zacks Consensus Estimate for 2012 is unchanged at $4.36.
However, the Zacks Consensus Estimate for 2013 has moved up 1.1% to
$4.69 over the last 30 days, representing an estimated annualized
growth of 7.5%.
Teleflex is favorably valued per most measures. The company
currently trades at a forward P/E multiple of 15.3, a 5.5% discount
to the peer group average of 16.2. The price-to-book ratio of 1.61
is 58.5% lower than the peer group average of 3.88. Similarly, the
price-to-sales ratio of 1.75 is 42.4% below the peer group average
of 3.04. The PEG ratio, however, comes in at 1.57.
A Look at the Chart
Since last July, the stock has fairly consistently beaten its 50-
and 200-day moving averages.
Based in Limerick, Pennsylvania, Teleflex is a provider of
specialized medical devices used in surgical and critical care
settings. Over the last few years, the company has divested its
holdings in cargo containers and cargo systems (part of the
erstwhile aerospace division of the company) besides selling off
its marine operations. The company now sells its medical devices in
over 130 nations. It has a market cap of about $2.7 billion.
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