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Merit Medical Systems (MMSI)
NASDAQ:MMSI
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Merit Medical Systems
(NASDAQ:MMSI)
64Neutral
Positive Factors
Financial Performance
Merit sales have beaten each quarter over the last two years and the two Q1 beats were the biggest beats of each respective year.
Growth Strategy
Merit Medical's cardiac intervention segment is expected to generate significant growth, aided by mergers and acquisitions.
Product Innovation
Merit's recent innovations, such as WRAPSODY, provide a path to upside in both sales and earnings by entering higher-growth segments.
Negative Factors
Cost Structure
Merit Medical faces challenges related to tariff exposure, which could impact its cost structure and profitability.
Tariff Concerns
The recent tariff escalation between the U.S. and China poses a significant risk to the revenue that Merit Medical generates in China.
Merit Medical Systems (MMSI) vs. S&P 500 (SPY)
Market Cap
$5.40B
Dividend YieldN/A
Average Volume (3M)776.24K
Price to Earnings (P/E)46.2
Beta (1Y)0.55
Revenue Growth8.07%
EPS Growth26.17%
CountryUS
Employees7,400
SectorHealthcare
Sector Strength64
IndustryMedical - Instruments & Supplies
Share Statistics
EPS (TTM)2.03
Shares Outstanding59,067,130
10 Day Avg. Volume809,379
30 Day Avg. Volume776,236
Financial Highlights & Ratios
PEG Ratio1.77
Price to Book (P/B)N/A
Price to Sales (P/S)4.41
Price to Cash Flow (P/CF)21.80
P/FCF Ratio23.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$116.40Price Target Upside24.15% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering10
Merit Medical Systems Business Overview & Revenue Model
Company DescriptionMerit Medical Systems, Inc. designs, develops, manufactures, and markets single-use medical products for interventional, diagnostic, and therapeutic procedures, primarily in cardiology, radiology, oncology, critical care, and endoscopy. The company operates in two segments, Cardiovascular and Endoscopy. It provides peripheral intervention products for the diagnosis and treatment of diseases in peripheral vessels and organs; and cardiac intervention products, such as access, angiography, electrophysiology and cardiac rhythm management, fluid management, hemodynamic monitoring, hemostasis, and intervention to treat various heart conditions. The company also offers custom procedural solutions that include critical care products, disinfection protection systems, syringes, manifold kits, and trays and packs; coated tubes and wires; and sensor components for microelectromechanical systems. In addition, it provides pulmonary products that consist of laser-cut tracheobronchial stents, over-the-wire and direct visualization delivery systems, and dilation balloons to endoscopically dilate strictures; gastroenterology products; and kits and accessories for endoscopy and bronchoscopy procedures. The company sells its products to hospitals and alternate site-based physicians, technicians, and nurses through direct sales force, distributors, original equipment manufacturer partners, or custom procedure tray manufacturers in the United States and internationally. Merit Medical Systems, Inc. was incorporated in 1987 and is headquartered in South Jordan, Utah.
How the Company Makes MoneyMerit Medical Systems generates revenue primarily through the sale of its medical devices and products to healthcare facilities, including hospitals, medical imaging centers, and surgical centers. The company's revenue model is based on manufacturing and distributing a broad range of high-quality medical products used in minimally invasive diagnostic and interventional procedures. Key revenue streams include sales from interventional cardiology and radiology products, which constitute a significant portion of its earnings. Additionally, Merit Medical benefits from strategic partnerships and collaborations with healthcare providers and institutions, as well as continuous innovation and expansion of its product line to meet the evolving needs of the medical industry.
Merit Medical Systems Financial Statement Overview
Summary
Merit Medical Systems demonstrates positive growth with steady revenue increases and improving operational margins. The balance sheet is robust with a strong equity base, though the rise in debt in 2024 is a concern. Strong cash flows further support financial health, but the absence of net income in 2024 is critical and needs addressing.Income Statement
Merit Medical Systems shows steady revenue growth over the years, with a 3.53% increase from 2023 to 2024. The gross profit margin appears strong in 2024, but net profit margin is effectively 0% due to no net income reported. Historically, EBIT and EBITDA margins have been improving, indicating operational efficiency, but the lack of net income for 2024 is a concern.67
Positive
Balance Sheet
The balance sheet indicates a solid equity base with a favorable equity ratio of 55.98% in 2023. The debt-to-equity ratio is 0.59 in 2023, showing moderate leverage. Despite the increase in debt in 2024, the company maintains a strong stockholders' equity, suggesting resilience and stability in its financial structure.73
Positive
Cash Flow
The cash flow statement reveals a robust free cash flow in 2024, with significant growth from the previous year. The operating cash flow to net income ratio is favorable, reflecting efficient cash generation relative to income. Strong free cash flow without capital expenditures suggests strong liquidity and operational capabilities.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.36B | 1.26B | 1.15B | 1.07B | 963.88M | Gross Profit |
| 643.33M | 583.87M | 519.10M | 485.33M | 401.18M | EBIT |
| 155.69M | 123.94M | 87.56M | 60.92M | -62.58M | EBITDA |
| 295.94M | 231.44M | 181.15M | 153.45M | 102.71M | Net Income Common Stockholders |
| 120.36M | 94.41M | 74.52M | 48.45M | -9.84M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 376.71M | 589.14M | 58.41M | 67.75M | 56.92M | Total Assets |
| 2.42B | 2.33B | 1.66B | 1.65B | 1.66B | Total Debt |
| 810.12M | 891.36M | 268.75M | 315.03M | 435.07M | Net Debt |
| 810.12M | 304.32M | 210.34M | 247.28M | 378.15M | Total Liabilities |
| 1.04B | 1.12B | 519.57M | 608.50M | 705.82M | Stockholders Equity |
| 1.38B | 1.20B | 1.14B | 1.04B | 958.58M |
| Cash Flow | Free Cash Flow | |||
| 220.80M | 108.45M | 69.26M | 119.29M | 115.99M | Operating Cash Flow |
| 220.80M | 145.15M | 114.29M | 147.23M | 165.27M | Investing Cash Flow |
| -368.65M | -175.35M | -57.40M | -37.16M | -58.65M | Financing Cash Flow |
| -60.01M | 559.27M | -60.26M | -98.44M | -95.71M |
Merit Medical Systems Technical Analysis
Neutral
93.76
Price Trends
100.16
Negative
101.33
Negative
97.96
Negative
Market Momentum
-2.84
Positive
45.40
Neutral
56.64
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MMSI, the sentiment is Neutral. The current price of 93.76 is below the 20-day moving average (MA) of 96.37, below the 50-day MA of 100.16, and below the 200-day MA of 97.96, indicating a bearish trend. The MACD of -2.84 indicates Positive momentum. The RSI at 45.40 is Neutral, neither overbought nor oversold. The STOCH value of 56.64 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for MMSI.
Merit Medical Systems Risk Analysis
Merit Medical Systems disclosed 38 risk factors in its most recent earnings report. Merit Medical Systems 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
Merit Medical Systems Peers Comparison
Overall Rating
UnderperformOutperform
Sector (51)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $5.90B | 45.99 | 9.40% | 0.27% | 1.72% | -21.26% | |
64 Neutral | $5.40B | 46.21 | 9.32% | ― | 8.07% | 26.17% | |
63 Neutral | $7.80B | ― | -1.30% | ― | 0.33% | -171.08% | |
61 Neutral | $5.80B | 87.79 | 1.61% | 1.05% | 2.45% | -80.87% | |
55 Neutral | $3.22B | ― | -5.76% | ― | 5.28% | -292.14% | |
55 Neutral | $8.22B | 116.65 | -25.23% | ― | 2.26% | -467.23% | |
51 Neutral | $5.20B | 3.26 | -40.34% | 2.93% | 17.68% | 1.94% |
* Healthcare Sector Average
Performance Comparison
MMSI
Merit Medical Systems
94.67
21.29
29.01%
ICUI
ICU Medical
137.16
42.63
45.10%
MASI
Masimo
162.63
27.39
20.25%
RGEN
Repligen
145.23
-20.43
-12.33%
TFX
Teleflex
135.66
-69.53
-33.89%
STVN
Stevanato Group
21.89
-5.55
-20.23%
Merit Medical Systems Earnings Call Summary
Earnings Call Date: Apr 24, 2025 | % Change Since: -0.96% | Next Earnings Date: Jul 23, 2025
Earnings Call Sentiment Positive
The earnings call presented a positive outlook with significant revenue growth and profitability increases, successful acquisitions, and strong free cash flow. However, challenges in international sales, particularly in the EMEA and China regions, as well as increased operating expenses and tariff uncertainties, were noted.Highlights
Strong Revenue Growth
Fourth quarter revenue of $355.2 million, up 9% year-over-year on a GAAP basis and up 10% on a constant currency basis, exceeding expectations.
Record Profitability
Non-GAAP operating profit growth of 30% and operating margin of 19.6%, up 305 basis points year-over-year.
Significant Free Cash Flow
Generated more than $185 million in free cash flow for the year, up 67% from 2023.
Strong Segment Performance
Cardiovascular segment grew by 8% and Endoscopy by 88%. Peripheral Intervention products sales increased by 5.5%.
Successful Integrations
Completed integrations of EndoGastric Solutions and Cook Medical acquisitions ahead of schedule.
Positive Guidance for 2025
Guidance for 2025 includes GAAP net revenue growth of 8% to 10% and a non-GAAP EPS increase of 4% to 7%.
Lowlights
International Sales Challenges
International sales increased only 5% year-over-year, with EMEA region softer than expected due to conditions in Russia and distributor markets.
China Market Volatility
Sales in China increased by only 4%, with growth affected by volume-based procurement and pricing headwinds.
Increased Operating Expenses
Operating expenses increased by 9% compared to the previous year, driven by a 6% increase in SG&A and a 26% increase in R&D expenses.
Tariff Uncertainty
Potential impact of new or modified tariffs not included in 2025 guidance, introducing uncertainty.
Company Guidance
During the Merit Medical Systems Fourth Quarter 2024 Earnings Conference Call, the company reported a total revenue of $355.2 million for the fourth quarter, reflecting a 9% year-over-year increase on a GAAP basis and a 10% increase on a constant currency basis. The company exceeded their growth expectations, which were initially set between 6% to 9% year-over-year for constant currency revenue. Notably, the company achieved a non-GAAP operating profit growth of 30% and a non-GAAP operating margin of 19.6% of sales, representing an increase of approximately 305 basis points year-over-year. Additionally, the company delivered a 26% growth in non-GAAP earnings per share, surpassing the high end of their expectations. Merit Medical also highlighted a record non-GAAP gross margin of 51.7% and generated more than $185 million in free cash flow, marking a 67% year-over-year increase. For fiscal year 2025, the company provided guidance with GAAP net revenue growth projected between 8% to 10% year-over-year, and constant currency revenue growth expected in the range of 8.6% to 10.1%. The company anticipates a non-GAAP diluted earnings per share growth of 4% to 7% year-over-year and plans to generate at least $150 million in free cash flow for the year.Merit Medical Systems Corporate Events
M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Merit Medical Systems Reports Strong 2024 Financial Results
Positive
Feb 25, 2025
Merit Medical Systems reported strong financial results for the fourth quarter and full year of 2024, with a 9.4% increase in quarterly revenue to $355.2 million and a 7.9% rise in annual revenue to $1.357 billion. The company also completed key acquisitions and received FDA approval for a new device, positioning itself for continued growth in 2025 with projected revenue increases of 8% to 10%.
Product-Related AnnouncementsBusiness Operations and Strategy
Merit Medical Celebrates FDA Approval of WRAPSODY™
Positive
Jan 28, 2025
On January 28, 2025, Merit Medical Systems held a conference call to discuss their WRAPSODY™ Cell-Impermeable Endoprosthesis, which recently received FDA premarket approval. This approval marks a significant milestone in Merit’s strategic initiative started in 2010, aiming to transition into higher-value medical devices. The launch of the Wrapsody CIE is seen as the beginning of further developments, as Merit has made both organic and inorganic investments to broaden its therapeutic platform and strengthen its market position, especially in dialysis. The company looks forward to leveraging its strategic foundation for future growth.
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.