AngioDynamics Inc (ANGO) is set to report second-quarter fiscal 2015 results on Jan 8. Last quarter, AngioDynamics reported earnings of 16 cents per share, which beat the Zacks Consensus Estimate by 4 cents. We note that on an average, AngioDynamics has delivered a positive earnings surprise of 102.50% through the last four quarters.
Let’s see how things are shaping up prior to this announcement.
Factors Likely to Influence This Quarter
We believe that AngioDynamics’ expanding product portfolio that includes products like AngioVac, Bioflo and Celerity significantly enhances its market opportunities. The strong product line helps the company offer solutions to patients suffering from venous Thromboembolism and varicose vein problems.
Celerity is significantly cost effective in finding tip location as compared to other prevalent competitive solutions. Meanwhile, Nanoknife is expected to improve AngioDynamics’ competitive position in the tissue ablation solution market, going forward.
Improving operating efficiency through consolidation of the N.Y. distribution center and ERP implementation is expected to result in almost $15 million to $18 million in cost savings, which will help AngioDynamics reach the gross margin target.
Moreover, we believe international expansion and accretive acquisitions will boost AngioDynamics’ competitive position against the likes of Boston Scientific (BSX), C.R. Bard (BCR) and Merit Medical Systems (MMSI) going forward.
Earnings Whispers?
Our proven model does not conclusively show that AngioDynamics is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. That is not the case here as you will see below.
Zacks ESP: AngioDynamics currently has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 16 cents.
Zacks Rank: AngioDynamics has a Zacks Rank #2 (Buy), which increases the predictive power of ESP. However, the company’s ESP of 0.00% makes surprise prediction difficult.
On the other hand, we caution against stocks with Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
United Continental Holdings (UAL) with an Earnings ESP of +7.63% and a Zacks Rank #1 (Strong Buy).
Southwest Airlines (LUV) with an Earnings ESP of +3.70% and a Zacks Rank #1.
PPG Industries (PPG) with an Earnings ESP of +0.51% and a Zacks Rank #1.
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