Zacks Research Lowers Earnings Forecast for Avanos Medical

Analysts at Zacks Research have revised their earnings estimates for Avanos Medical, Inc. (NYSE: AVNS) for the fiscal year 2025. In a report released on November 26, 2023, Zacks lowered its earnings per share (EPS) projection from $0.92 to $0.89. The firm currently maintains a “Hold” rating on the stock, indicating a cautious outlook amidst shifting forecasts.

The consensus estimate for Avanos Medical’s earnings for the current fiscal year stands at $1.32 per share. In addition to the annual forecast, Zacks provided estimates for upcoming quarterly earnings, anticipating $0.24 EPS for Q4 2025, followed by $0.23 EPS in Q1 2026, $0.22 EPS in Q2 2026, $0.27 EPS in Q3 2026, and $0.36 EPS in Q4 2026. For the fiscal year 2026, the firm projects earnings of $1.08 per share and estimates for fiscal year 2027 are set at $1.24 per share.

On November 5, 2023, Avanos Medical reported its latest earnings results, posting an EPS of $0.22 for the quarter. This figure surpassed analysts’ expectations of $0.12 by $0.10. The company’s revenue for the quarter reached $177.80 million, exceeding analyst estimates of $164.50 million. Despite this positive performance, Avanos Medical recorded a negative net margin of 67.00%, though it achieved a return on equity of 6.21%. Year-on-year, the revenue increased by 4.3%, compared to the same quarter last year when the company reported an EPS of $0.33.

Avanos Medical has set its fiscal year 2025 guidance in the range of $0.850 to $0.950 EPS. Other research firms have also expressed varying opinions on Avanos Medical. For instance, Weiss Ratings reissued a “sell (d)” rating on the company on November 25, 2023, while Wall Street Zen upgraded its rating from “buy” to “strong-buy” on November 8, 2023. Currently, one analyst has assigned a “Hold” rating, while another has given a “Sell” rating.

As of the latest data from MarketBeat.com, Avanos Medical shares opened at $11.74 on Monday, with a market capitalization of $544.97 million. The stock has a price-to-earnings ratio of -1.15 and a beta of 1.09. Over the last 52 weeks, the stock has seen a low of $9.30 and a high of $19.91. The company maintains a debt-to-equity ratio of 0.12, along with a current ratio of 2.38 and a quick ratio of 1.36.

In other news, Kerr Holbrook, Senior Vice President of Avanos Medical, sold 15,000 shares on November 18, 2023, at an average price of $11.00, resulting in a total transaction of $165,000. Following this transaction, Holbrook’s ownership in the company decreased by 15.17%, leaving him with 83,860 shares valued at approximately $922,460. Insider ownership currently accounts for 2.64% of the company’s stock.

Several hedge funds have recently adjusted their holdings in Avanos Medical. Armistice Capital LLC acquired a new stake valued at approximately $28.66 million in the first quarter. T. Rowe Price Investment Management Inc. increased its stake by 24.8%, now holding 3,757,576 shares worth about $53.85 million. Millennium Management LLC significantly boosted its holdings by 312.4%, now owning 896,242 shares valued at $10.36 million. Ameriprise Financial Inc. and Citadel Advisors LLC also expanded their stakes in the company.

Overall, institutional investors and hedge funds collectively own 95.17% of Avanos Medical’s stock, reflecting a strong interest in the company’s future prospects. As a medical technology firm, Avanos Medical specializes in delivering innovative medical device solutions across various regions, including North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America, with a focus on chronic care products.