Enovis (ENOV) AI Stock Analysis

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Enovis

(NYSE:ENOV)

50Neutral

Enovis is experiencing robust revenue growth and potential synergies from the Lima acquisition, contributing positively to its prospects. However, substantial profitability and liquidity challenges, reflected in negative profit margins and cash flow, weigh heavily. The technical analysis indicates a bearish trend, and the valuation is unattractive due to a negative P/E ratio. The earnings call offered some optimism with positive future guidance, but risks such as goodwill impairment and potential tariffs remain significant.

Positive Factors

Leadership Experience

The appointment of Damien McDonald as the new CEO brings valuable experience in MedTech and Orthopedics, which is seen positively by investors.

Product Launches

New product launches are expected to drive growth for Enovis.

Strategic Acquisition

The acquisition of Lima is a significant strategic move for Enovis.

Negative Factors

Tariff Exposure

Tariff exposure is a topic of concern for Enovis.

Uncertainty Factors

Sentiment is being weighed by multiple small factors creating uncertainty around the durability of the P&L.

Enovis (ENOV) vs. S&P 500 (SPY)

Market Cap

$1.95B

Dividend YieldN/A

Average Volume (3M)941.34K

Price to Earnings (P/E)―

Beta (1Y)1.13

Revenue Growth23.46%

EPS Growth-1552.75%

CountryUS

Employees7,367

SectorIndustrials

Sector Strength77

IndustryIndustrial - Machinery

Share Statistics

EPS (TTM)0.81

Shares Outstanding57,107,950

10 Day Avg. Volume927,247

30 Day Avg. Volume941,335

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap1.96

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit3.23

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$62.71

Price Target Upside83.95% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering8

Enovis Business Overview & Revenue Model

Company DescriptionEnovis (ENOV) is a diversified medical technology company specializing in innovative solutions across the orthopedic and rehabilitation sectors. The company develops, manufactures, and markets a range of medical devices and products designed to enhance mobility and improve patient outcomes. Enovis's core offerings include joint replacement implants, surgical tools, rehabilitation equipment, and other orthopedic solutions aimed at supporting healthcare providers and patients worldwide.

How the Company Makes MoneyEnovis makes money primarily through the sale of its medical devices and products to healthcare facilities, including hospitals, surgical centers, and rehabilitation clinics. The company's revenue streams are centered around its orthopedic and rehabilitation segments, with significant income generated from the sale of joint replacement implants and surgical instruments. Enovis also benefits from long-term partnerships and contracts with healthcare providers that ensure a steady demand for its products. Additionally, the company invests in research and development to innovate and expand its product offerings, which can lead to new revenue opportunities in existing and emerging markets.

Enovis Financial Statement Overview

Summary

Enovis shows strong revenue growth but faces challenges with profitability, as indicated by negative profit margins and ROE. The balance sheet shows a prudent leverage position, yet cash flow difficulties are notable, with negative free cash flow affecting liquidity management. Overall, the company needs to address its profitability and cash flow issues to improve financial health.

Income Statement

Neutral

Enovis has experienced a significant revenue increase from 2023 to 2024, marking a 23.48% growth rate. However, the company is struggling with profitability, as evidenced by a negative net profit margin of -39.17% for 2024 and a negative EBIT margin of -39.27%. These negative margins indicate substantial challenges in managing expenses relative to revenue.

Balance Sheet

Neutral

The company's debt-to-equity ratio has improved to 0.03 in 2024, suggesting lower leverage risk. However, the return on equity (ROE) remains negative at -32.22%, indicating that the company is not generating value for shareholders. The equity ratio is 54.30%, reflecting a stable financial structure with a majority of assets funded by equity.

Cash Flow

Negative

Operating cash flow to net income ratio is positive at 0.14, but the free cash flow is negative, indicating a cash outflow situation. The free cash flow to net income ratio is negative, highlighting struggles in converting earnings into cash, which can impact liquidity.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
2.11B	1.71B	1.56B	3.85B	3.07B
	Gross Profit
1.18B	990.78M	869.38M	1.61B	1.29B
	EBIT
-775.72M	-65.71M	-88.57M	256.64M	162.29M
	EBITDA
-827.42M	169.92M	225.78M	95.03M	180.05M
	Net Income Common Stockholders
-825.49M	-33.26M	-38.19M	98.69M	64.08M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
48.17M	36.19M	24.30M	719.37M	97.07M
	Total Assets
4.72B	4.51B	4.27B	8.52B	7.35B
	Total Debt
72.49M	536.42M	310.54M	2.23B	2.37B
	Net Debt
24.32M	500.23M	286.24M	1.51B	2.27B
	Total Liabilities
2.15B	1.09B	823.45M	3.85B	3.76B
	Stockholders Equity
2.56B	3.42B	3.45B	4.62B	3.54B
Cash Flow		Free Cash Flow
-67.21M	12.77M	-161.31M	251.86M	187.15M
	Operating Cash Flow
113.50M	134.99M	-55.86M	356.10M	301.94M
	Investing Cash Flow
-955.47M	-242.47M	-176.39M	-320.48M	-175.08M
	Financing Cash Flow
846.82M	127.80M	-465.13M	584.91M	-131.65M

Enovis Technical Analysis

Technical Analysis Sentiment

Negative

Last Price34.09

Price Trends

50DMA

35.78

Negative

100DMA

40.43

Negative

200DMA

42.24

Negative

Market Momentum

MACD

-0.38

Negative

RSI

47.39

Neutral

STOCH

31.39

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ENOV, the sentiment is Negative. The current price of 34.09 is above the 20-day moving average (MA) of 33.53, below the 50-day MA of 35.78, and below the 200-day MA of 42.24, indicating a neutral trend. The MACD of -0.38 indicates Negative momentum. The RSI at 47.39 is Neutral, neither overbought nor oversold. The STOCH value of 31.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ENOV.

Enovis Risk Analysis

Enovis disclosed 40 risk factors in its most recent earnings report. Enovis reported the most risks in the “Legal & Regulatory” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Enovis Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EPAC	71 Outperform	$2.25B	24.85	23.87%	0.10%	0.43%	34.59%
SXI	68 Neutral	$1.90B	31.27	9.29%	0.78%	2.67%	-18.41%
TNC	65 Neutral	$1.32B	20.01	11.04%	1.60%	1.35%	-40.63%
CXT	64 Neutral	$2.73B	15.13	18.15%	1.35%	-21.96%	-27.05%
Sector *	64 Neutral	$4.25B	11.69	5.23%	249.83%	4.04%	-9.46%
ENOV	50 Neutral	$1.95B	―	-27.69%	―	23.46%	-1552.75%
HI	48 Neutral	$1.39B	―	-18.22%	4.53%	0.31%	-423.59%

* Industrials Sector Average

Performance Comparison

ENOV

Enovis

34.24

-16.43

-32.43%

EPAC

Enerpac Tool Group

41.69

4.20

11.20%

CXT

Crane NXT

47.64

-13.67

-22.30%

Hillenbrand

19.58

-24.41

-55.49%

SXI

Standex International

152.53

-19.64

-11.41%

TNC

Tennant Co

70.78

-35.89

-33.65%

Enovis Earnings Call Summary

Earnings Call Date:May 08, 2025

(Q4-2024)

% Change Since: -19.03%|

Next Earnings Date:Jul 31, 2025

Earnings Call Sentiment Positive

The earnings call highlights significant revenue growth and successful integration of the Lima acquisition, with strong new product launches and improved EBITDA margins. However, challenges include a substantial goodwill impairment, increased interest expenses, and potential tariff impacts. The positive aspects, particularly the strong growth and synergy realization, outweigh the negatives.

Q4-2024 Updates

Positive Updates

Strong Revenue Growth

Fourth quarter sales of $561 million, up 23% versus the prior year and up 7% on a comparable constant currency basis. Recon business grew 10% with double-digit growth globally across main segments in Hip, Knee, and extremities.

Successful Integration and Synergies from Lima Acquisition

The first year of the Lima acquisition exceeded revenue and profit goals, with successful channel and organizational integrations. Expected to deliver $40 million plus in synergies over three years.

Improved EBITDA Margins

Fourth quarter adjusted EBITDA grew 38%, with a margin of 20.1%, up 210 basis points versus the same quarter last year.

New Product Launches and Expansion

Strong momentum with new product launches, including revision cones, knees, augmented systems, and key launches in hip implants and enabling technology.

Negative Updates

Goodwill Impairment

Recorded a noncash technical impairment of goodwill at the end of the year, amounting to $645 million due to a sustained decrease in share price and market capitalization.

Increased Interest Expenses

Interest expense was $9 million for the quarter versus $4 million in 2023.

Potential Tariff Impacts

Potential exposure to tariffs from China and Mexico, with an estimated $3 million to $4 million exposure per month if tariffs are applied.

Company Guidance

During the fourth quarter of 2024, Innovus reported a 23% increase in sales, achieving a 7% growth on a constant currency comparable basis. The company successfully expanded its adjusted EBITDA margins by 210 basis points, reaching 20.1%, and delivered an adjusted gross margin of 60.1%, marking a 150 basis point increase from the previous year. Innovus' Recon business exhibited notable performance with a 59% reported global revenue growth, driven by a 10% increase on a comparable basis, highlighted by double-digit growth in the Hip and Extremities segments. The U.S. Recon sector grew by 7%, complemented by a 13% international growth. The integration of Lima exceeded expectations, contributing to the company's strong commercial and operational trajectory. Enovis also provided guidance for 2025, projecting revenues between $2.19 billion and $2.22 billion with constant currency organic growth of 6% to 6.5%. Adjusted EBITDA is anticipated to be in the range of $405 million to $415 million, with an adjusted earnings per share range of $3.10 to $3.25.

Enovis Corporate Events

Executive/Board ChangesBusiness Operations and Strategy

Enovis Appoints Damien McDonald as New CEO

Neutral

Apr 2, 2025

Enovis Corporation announced the appointment of Damien McDonald as its new Chief Executive Officer, effective May 12, 2025, succeeding Matt Trerotola who will retire but remain as an Executive Advisor for a year. McDonald, with over 35 years in the medical device industry, previously served as CEO of LivaNova and will join the Enovis Board following the 2025 Annual Meeting. The company also reaffirmed its first quarter revenue and adjusted EBITDA expectations, indicating stability and continuity in its strategic direction.

Executive/Board Changes

Enovis CEO Matthew Trerotola Announces Retirement Plan

Neutral

Mar 14, 2025

On February 25, 2025, Enovis Corporation announced that CEO Matthew L. Trerotola will retire upon the appointment of his successor. A retirement and transition agreement was made on March 13, 2025, allowing Trerotola to serve as an Executive Advisor for a year, with a reduced salary and continued benefits, but no new equity or incentive awards.

Executive/Board ChangesBusiness Operations and Strategy

Enovis CEO Retirement and Leadership Transition Announced

Neutral

Feb 26, 2025

On February 25, 2025, Enovis Corporation announced that its CEO, Matthew L. Trerotola, plans to retire once a successor is appointed. To ensure a smooth transition, Trerotola will serve as an Executive Advisor for one year following the appointment of the new CEO. The company is actively searching for a growth-oriented leader in the MedTech industry to continue its focus on innovation and patient outcomes. This leadership change comes as Enovis positions itself for continued growth and industry leadership.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.