The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how medical devices & supplies - specialty stocks fared in Q3, starting with Bausch + Lomb (NYSE: BLCO).

The medical devices industry operates a business model that balances steady demand with significant investments in innovation and regulatory compliance. The industry benefits from recurring revenue streams tied to consumables, maintenance services, and incremental upgrades to the latest technologies, although specialty devices are more niche. The capital-intensive nature of product development, coupled with lengthy regulatory pathways and the need for clinical validation, can weigh on profitability and timelines. In addition, there are constant pricing pressures from healthcare systems and insurers maximizing cost efficiency. Over the next several years, one tailwind is demographic–aging populations means rising chronic disease rates that drive greater demand for medical interventions and monitoring solutions. Advances in digital health, such as remote patient monitoring and smart devices, are also expected to unlock new demand by shortening upgrade cycles. On the other hand, the industry faces headwinds from pricing and reimbursement pressures as healthcare providers increasingly adopt value-based care models. Additionally, the integration of cybersecurity for connected devices adds further risk and complexity for device manufacturers.

The 7 medical devices & supplies - specialty stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.7%.

Thankfully, share prices of the companies have been resilient as they are up 5.2% on average since the latest earnings results.

Bausch + Lomb (NYSE: BLCO)

With a nearly 170-year history dedicated to vision care and eye health innovation, Bausch + Lomb (NYSE: BLCO) develops and manufactures a comprehensive range of eye health products including contact lenses, pharmaceuticals, surgical devices, and consumer eye care solutions.

Bausch + Lomb reported revenues of $1.28 billion, up 7.1% year on year. This print was in line with analysts’ expectations, and overall, it was a satisfactory quarter for the company with a beat of analysts’ EPS estimates but constant currency revenue in line with analysts’ estimates.

“We’re delivering on the vision we laid out in 2023, with a base business engine that continues to hum and steady introduction of innovative products across categories,” said Brent Saunders, chairman and CEO, Bausch + Lomb.

Bausch + Lomb scored the highest full-year guidance raise but had the weakest performance against analyst estimates of the whole group. Unsurprisingly, the stock is up 3% since reporting and currently trades at $15.63.

Is now the time to buy Bausch + Lomb? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: STAAR Surgical (NASDAQ: STAA)

With over 2.5 million implants performed worldwide, STAAR Surgical (NASDAQ: STAA) designs and manufactures implantable lenses that correct vision problems without removing the eye's natural lens.

STAAR Surgical reported revenues of $94.73 million, up 6.9% year on year, outperforming analysts’ expectations by 4.3%. The business had a stunning quarter with a solid beat of analysts’ constant currency revenue estimates and a beat of analysts’ EPS estimates.

However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $26.55.

Is now the time to buy STAAR Surgical? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: Integer Holdings (NYSE: ITGR)

With its name reflecting the mathematical term for "whole" or "complete," Integer Holdings (NYSE: ITGR) is a medical device outsource manufacturer that produces components and systems for cardiac, vascular, neurological, and other medical applications.

Integer Holdings reported revenues of $467.7 million, up 8.4% year on year, in line with analysts’ expectations. It was a slower quarter as it posted full-year EBITDA guidance missing analysts’ expectations significantly and full-year revenue guidance slightly missing analysts’ expectations.

As expected, the stock is down 37.5% since the results and currently trades at $68.25.

Read our full analysis of Integer Holdings’s results here.

Enovis (NYSE: ENOV)

With a focus on helping patients regain or maintain their natural motion, Enovis (NYSE: ENOV) develops and manufactures medical devices for orthopedic care, from injury prevention and pain management to joint replacement and rehabilitation.

Enovis reported revenues of $548.9 million, up 8.6% year on year. This print beat analysts’ expectations by 2.1%. It was a strong quarter as it also produced a beat of analysts’ EPS estimates and an impressive beat of analysts’ revenue estimates.

The stock is down 10.9% since reporting and currently trades at $28.06.

Read our full, actionable report on Enovis here, it’s free for active Edge members.

Haemonetics (NYSE: HAE)

With roots dating back to 1971 and a mission to improve blood-related healthcare, Haemonetics (NYSE: HAE) provides specialized medical devices and software for blood collection, processing, and management across plasma centers, blood banks, and hospitals.

Haemonetics reported revenues of $327.3 million, down 5.3% year on year. This number topped analysts’ expectations by 5.3%. Overall, it was an exceptional quarter as it also logged a solid beat of analysts’ organic revenue estimates and an impressive beat of analysts’ revenue estimates.

Haemonetics pulled off the biggest analyst estimates beat but had the slowest revenue growth among its peers. The stock is up 35% since reporting and currently trades at $68.45.

Read our full, actionable report on Haemonetics here, it’s free for active Edge members.

Market Update

In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.

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