Analyst Impressed With CONMED's Upbeat Q1 Performance and Raised Guidance, Bullish On Organic Growth

CONMED Corporation CNMD shares are trading higher after the company reported better-than-expected Q1 earnings. It reported Q1 adjusted EPS of $0.66, beating the consensus of $0.60 but down 5.7% Y/Y.

The Q1 sales came in at $295.47 million, up 21.9% (25.1% in constant currency), surpassing the consensus of $266.67 million.

The company raised FY23 revenue guidance to $1.205-$1.250 billion from $1.170-$1.220 billion expected earlier, versus the consensus of $1.19 billion.

FY23 adjusted EPS is expected to be $3.30 to $3.50, compared to its prior range of $3.20-$3.45 and the consensus of $3.32.

Needham says CNMD's revenue growth improved as it caught up on its $30 million order backlog after weak 4Q22 results caused by a warehouse software issue. 

"Given all the moving parts, CNMD's true underlying growth in 1Q23 is difficult to decipher, but we have confidence that it can return to high-single-digit organic growth with significant operating margin improvement in future quarters," the analyst writes.

It reiterated the Buy rating with an increased price target of $134 from $122 due to peer multiple expansion.

Keybanc Maintains Overweight with a price target of $131 from $124. Wells Fargo maintains an Equal-Weight, raising the price target from $96 to $119.

Piper Sandler maintains an Overweight, raising the price target from $118 to $128. Stifel increased the price target from $118 to $130 with a Buy rating.

Price Action: CNMD shares are up 13.10% at $129.03 on the last check Thursday.