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Mazor Robotics at a 52-Week High: What’s Driving the Stock?

Zacks

Shares of Israel-based developer of robotic technology and products, Mazor Robotics Ltd. MZOR, rallied to a new 52-week high of $45.64 on May 18, eventually closing a little lower at $42.68. This represents a strong one-year return of about 185%, much better than the S&P 500’s return of 14.2%.

Mazor has had an impressive run on the bourse on a year-to-date basis. The company has gained roughly 94.1%, higher than the Zacks categorized Medical Instruments sub-industry’s addition of just 12.5%.

The stock has a market cap of $1.03 billion and carries a Zacks Rank #3 (Hold). Let us take a look at the key catalysts driving the stock’s performance.

Mazor Robotics Ltd. Price and Consensus


Mazor Robotics Ltd. Price and Consensus | Mazor Robotics Ltd. Quote

Growing Installations at Mazor X System

Mazor recently announced the installation of a Mazor X system at Houston Methodist Hospital in Texas. In the last reported quarter, the company had received purchase orders for six Mazor X systems. Since the launch of the Mazor X system, Mazor has received a total of 43 cumulative orders in the platform.

Solid Revenue Growth in Q1

Mazor reported total revenue of $11.7 million, marginally beating the Zacks Consensus Estimate of $11 million. Notably, revenues marked an 83% increase on a year-over-year basis. The solid performance was driven by several factors like strong sales order and pipeline for the new Mazor X system and the continued utilization of the Renaissance installed base.

Capital sales revenues were $6.5 million in the first quarter of 2017, reflecting a 150% increase from $2.6 million in the first quarter of 2016. Recurring revenue from system kit sales, service and other increased 37% on a year-over-year basis to $5.2 million.

Geographically, revenues in the U.S. rose 100% to $11.2 million from $5.6 million in the year-ago quarter.

Favorable Regulatory Developments

Earlier this quarter, Mazor announced the receipt of FDA clearance for its Mazor X Align software. The Mazor X Align software is designed to assist surgeons in planning spinal deformity correction and spinal alignment for procedures performed with the Mazor X Surgical Assurance Platform.

Taking this development into consideration, we are encouraged by the opportunities in the global spine surgery market. A research report by Markets And Markets suggests that the niche markets will reach a worth of $17.27 billion by 2021, multiplying at a CAGR of 5.3%.

Key Picks

Better-ranked stocks in the broader medical sector include Luminex Corporation LMNX, Hologic, Inc. HOLX and Inogen Inc INGN. Notably, Inogen and Luminex sport a Zacks Rank #1 (Strong Buy), while Hologic carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Inogen promises a long-term adjusted earnings growth of almost 17.5%. The stock returned 81.5% over the last one year.

Luminex has an expected long-term adjusted earnings growth of almost 16.3%. The stock added roughly 6.4% over the last three months.

Hologic has a long-term expected earnings growth rate of 11.33%. The stock has a solid one-year return of roughly 29.2%.

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