Stryker Corporation SYK is scheduled to release first-quarter 2020 results on Apr 30 after the closing bell. In the last reported quarter, the company delivered a positive earnings surprise of 1.2%. Further, it has a trailing four-quarter positive earnings surprise of 1.5%, on average.

Q1 Estimates

The Zacks Consensus Estimate for first-quarter earnings per share is pegged at $1.85, indicating a decline of 1.6% from the year-ago quarter.

The same for revenues stands at $3.57 billion, suggesting growth of 1.7% from the prior-year quarter.

MedSurg in Focus

This segment comprises surgical instruments plus endoscopic and emergency medical equipment. Notably, it has been consistently driving Strykers top line.

The Zacks Consensus Estimate for the segments first-quarter revenues stands at $1.64 billion, suggesting an improvement of 6.4% year-ago reported figure.

Stryker Corporation Price and EPS Surprise

Stryker Corporation Price and EPS Surprise

Stryker Corporation price-eps-surprise | Stryker Corporation Quote

MedSurg has three subsegments Endoscopy, Instruments and Medical.

Growth across its aforementioned three subsegments is likely to have benefited MedSurgs first-quarter performance. The segment is anticipated to have witnessed considerable worldwide organic growth in the to-be-reported quarter driven by instruments.

Other Factors to Note

The companys first-quarter performance is likely to reflect broad-based strength across its divisions and regions. In fact, robust performance in emerging markets (except China) and Europe for the first two months of the to-be-reported quarter is likely to get reflected in the companys results. However, with the coronavirus outbreak intensifying around late February is likely to have affected the same.

Strykers Orthopaedics segment is likely to have witnessed strong organic growth on the back of solid performance at the Knee and Hips sub segments during the first two months of the quarter to be reported. However, the pandemic had an adverse impact on elective procedures since late February, which in turn might have weighed on the segments overall performance.

Sustained strong demand for Mako TKA (Total Knee Arthoplasty) platform or cementless knee and other 3D printed products for the first two months of the quarter is anticipated to get reflected in the segments first-quarter performance. Although it is important to note here that with the elective procedures taking a hit due to the coronavirus impact (since late February), the company is likely to have witnessed decline in the demand for Mako TKA. This, in turn, might have weighed on the companys performance in the to-be-reported quarter.

With respect to Neurotechnology & Spine segment, a bankable performance within the NeuroTech and Interventional Spine businesses is likely to have contributed to the companys first-quarter performance. For the upcoming quarterly announcement, the Zacks Consensus Estimate for the segments sales stands at $779 million, suggesting growth of 7.9% from the year-ago reported figure.

During fourth-quarter 2019, the company acquired Mobius Imaging a leader in point-of-care imaging technology along with its sister company Cardan Robotics in an all-cash transaction for $370 million upfront and up to $130 million of contingent payments related to development and commercial milestones. This transaction is likely to have aided Stryker Spine foray into the intra-operative Imaging segment apart from aligning with Stryker's implant and navigation offering. We expect this development to have positively impacted the companys first-quarter performance.

However, unfavorable pricing is likely to have affected Strykers first-quarter top line. Moreover, high debt might have put pressure on the margins.

What Our Quantitative Model Suggests

Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here as you will see.

Earnings ESP: Stryker has an Earnings ESP of -3.29%. You can uncover the best stocks to buy or sell before theyre reported with our Earnings ESP Filter.

Zacks Rank: Stryker carries a Zacks Rank #4 (Sell).

Stocks Worth a Look

Here are a few medical stocks worth considering as they have the right combination of elements to post an earnings beat this quarter.

Chemed Corporation CHE has an Earnings ESP of +0.42% and a Zacks Rank of 2. You can see the complete list of todays Zacks #1 Rank stocks here.

Haemonetics Corporation HAE has an Earnings ESP of +2.76% and a Zacks Rank of 3.

DexCom, Inc. DXCM has an Earnings ESP of +139.12% and a Zacks Rank of 2.

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Stryker (SYK) to Report Q1 Earnings: What's in the Offing? - Yahoo Finance