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CryoLife (CRY) Hits 52-Week High: What’s Driving the Stock?


Share price of CryloLife, Inc. CRY, a leading medical device and tissue processing company, scaled a new 52-week high of $20.05 on Nov 23, eventually closing a bit lower at $19.90.

A glimpse at the company’s share price movement reveals a stupendous one-year return of approximately 80.9%, way better than the S&P 500’s roughly 5.6% over the same time frame. Notably, the company witnessed an impressive 19.2% increase in share price since the release of promising third-quarter 2016 results in October.

While the company’s current earnings yield is 2.26%, far better than the industry average of -4.29%, its projected sales growth for the current year is 25.16% compared to the industry average of 5.5%.

CryoLife registered positive earnings surprises in the last four quarters, the average being 333.75%. Meanwhile, the stock carries a Zacks Rank #1 (Strong Buy) and has a market cap of $638.89 million.

CRYOLIFE INC Price and Consensus

CRYOLIFE INC Price and Consensus | CRYOLIFE INC Quote

Estimate Revisions

The estimate revision trend for the company is pretty favorable at the moment with three estimates going up and no downward movement.

The Zacks Consensus Estimate for the current year rose by 10 cents to 44 cents over the last 30 days.

Similarly, for fiscal 2017, estimates increased by 5 cents to 43 cents over the same time frame.

Growth Catalysts

CryoLife has shown growing prominence in the medical-instruments industry, primarily driven by strength in its tissue processing business and the On-X acquisition. The recent developments in tissue processing operations, especially in the vascular tissue platform, has significantly boosted CryoLife’s trajectory.

The acquisition of On-X Life, a TX-based mechanical heart valve company, also buoys optimism. The acquisition marked CryoLife’s entry into the Mechanical Heart Valve market, which is forecasted to reach a worth of $4.80 billion by 2020, growing at a CAGR of 9.1% globally (Markets & Markets). Notably, the acquisition represented year-over-year revenue growth of 6% in the just reported third quarter of 2016.

In this regard, CryoLife reported adjusted earnings of 13 cents per share in the third quarter, crushing the Zacks Consensus Estimate of 4 cents. Revenues of $45.3 million were in line with the estimate mark but increased almost 21.6% on a year-over-year basis.

CryoLife recently announced its plans to resume enrollment under the PerClot Investigational Device Exemption (IDE) trial platform in the fourth quarter. Notably, the PerClot IDE is a multicenter, multidisciplinary, controlled clinical investigation. Management expects a FDA approval for the product in the first half of 2019.

Solid sales at the BioGlue product line in the U.S. and international markets have also been a propeller for the stock. Notably, total BioGlue sales in the third quarter were $15.9 million, up 12% year over year, courtesy of solid sales in France and Japan. In fact, CryoLife is on track to start enrollment under the BioGlue clinical trial platform in the first quarter of 2017 in China.

Coming to forecasts, CryoLife expects to end the year with a solid fourth quarter. Revenues for the full year are projected in the band of $181–$182.5 million, up from the previous range of $180–$182 million. Adjusted earnings are expected in the range of 43–45 cents per share, compared to the previous guidance of 32–34 cents.

Key Picks

Other favorably ranked stocks in the broader medical space include HMS Holdings Corp. HMSY, Medidata Solutions Inc. MDSO and IDEXX Laboratories, Inc. IDXX. Notably, HMS Holdings and Medidata Solutions carry a Zacks Rank #2 while IDEXX Laboratories sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

HMS Holdings Corp has a long-term expected growth rate of 14.26%. Notably, the company has a solid one-year return of roughly 58%.

Medidata Solutions has a strong one-year return of roughly 19.24%. The stock represents a long-term expected growth rate of 22.33%.

IDEXX Laboratories represents a solid one-year return of almost 71.07%. The company has a long-term expected growth rate of almost 14.96%.

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