Here's Why You Should Retain CONMED Stock in Your Portfolio Now

Shares of this Zacks Rank #3 (Hold) company have gained 24.2% in the year-to-date period, outperforming the industry’s 5.8% increase and the S&P 500 Index’s 13.3% rise.

Image Source: Zacks Investment Research

CONMED, a renowned global medical products manufacturer specializing in surgical instruments and devices, has a market capitalization of $1.51 billion. The company projects 4.8% earnings growth over the next five years.

The company’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 11.30%.

Factors Favoring CNMD Stock

Core Portfolio Is Returning to Healthy Organic Growth: CONMED delivered 6% organic sales growth in the second quarter of 2026, modestly above the high end of its previous expectation, despite reported revenues rising only 0.3% due to portfolio exits and currency. General Surgery grew 5.3% organically, while Orthopedic Surgery increased 6.8%, demonstrating broad-based momentum across the continuing portfolio.

International orthopedic sales were particularly strong, rising 10.8%. Management remains confident in achieving at least 5% organic constant-currency growth in 2026, while expecting sequential improvement during the second half. This suggests that the business is likely to report healthier returns in the next couple of quarters as CONMED completes its portfolio optimization.

Buffalo Filter Benefits From Regulatory Tailwinds: Buffalo Filter offers CONMED a potentially durable growth opportunity as surgical smoke evacuation gains regulatory momentum. Direct smoke evacuation sales exceeded the company's longer-term high-single-digit to low-double-digit growth target in the second quarter, more than offsetting declines in the OEM portfolio.

Importantly, 22 U.S. states now have smoke-free operating-room laws covering approximately 57% of the U.S. population, while more than 10 additional states have pending legislation. Michigan and Maryland recently added requirements, creating a multiyear adoption runway. CONMED is also seeing early traction internationally and expects its next-generation PlumeSafe X5 to strengthen penetration in ambulatory and outpatient settings.

Biobrace and Orthopedic Soft-Tissue Repair Can Support Sustained Growth: BioBrace is emerging as another differentiated growth franchise, particularly in rotator cuff repair, where approximately 1 million procedures are performed annually in the United States and re-tear rates remain significant. CONMED cites a 94% healing rate among high-risk patients using BioBrace augmentation, supported by more than 30 published studies and updated AAOS guidelines recommending augmentation.

The one-year-old BioBrace RC product is also gaining traction because it simplifies and standardizes augmentation, encouraging repeat utilization. Management noted increasing new-user adoption and durable retention among surgeons who gain experience with the product. These dynamics could create a recurring growth engine as BioBrace penetrates a large unmet clinical need.

Challenges Facing CNMD Stock

AirSeal Growth Is Moderating Relative to Earlier Expectations: Although AirSeal remained the top contributor to General Surgery growth in the second quarter, its performance was below management's expectations. The company now expects growth to improve in the second half of 2026, but at a slower pace than previously anticipated, prompting a more measured outlook.

This matters because AirSeal is a key component of CONMED's growth thesis, and a slower adoption curve could delay the benefits expected from robotic surgery, laparoscopic procedures and ASC expansion. Management continues to believe the franchise can generate high-single-digit to low-double-digit long-term growth, but the near-term deceleration highlights execution and adoption risks even within one of the company's highest-priority growth platforms.

Tariffs Remain a Meaningful Earnings Headwind Despite Refund: CONMED’s second-quarter EPS benefited materially from a 21-cent-per-share tariff refund, creating a risk that investors may overestimate the sustainability of the quarter’s earnings strength. Management noted that the refund was related to tariffs paid in 2025, while the company continues to expect a roughly 35-cent-per-share EPS headwind from tariffs in 2026.

Excluding the refund, second-quarter adjusted operating margin was essentially flat year over year, underscoring that underlying profitability was less robust than the headline 250-basis-point margin expansion suggested. As a result, future earnings growth will need to be driven by organic sales growth, product mix, and operating efficiencies instead of temporary tariff benefits.

Estimate Trend

CONMED is witnessing a stable estimate revision trend for 2026. In the past 30 days, the Zacks Consensus Estimate for earnings has improved 3.7% to $4.54 per share.

The Zacks Consensus Estimate for third-quarter 2026 revenues and EPS is pegged at $336.8 million and $1.00, respectively, suggesting a decline of 0.3% and 7.4% from the year-ago reported numbers.

Stocks to Consider

Some better-ranked stocks from the broader medical space are Globus Medical GMED, West Pharmaceutical WST and The Cooper Companies COO.

Globus Medical, currently sporting a Zacks Rank #1 (Strong Buy), reported a second-quarter 2026 adjusted earnings per share (EPS) of $1.34, which surpassed the Zacks Consensus Estimate by 19.6%. Revenues of $789.6 million beat the Zacks Consensus Estimate by 0.4%. You can see the complete list of today’s Zacks #1 Rank stocks here.

GMED has an estimated long-term earnings growth rate of 12.4%. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 27.9%.

West Pharmaceutical, carrying a Zacks Rank #2 (Buy) at present, reported second-quarter 2026 adjusted EPS of $2.37, which beat the Zacks Consensus Estimate by 13.9%. Revenues of $872.3 million surpassed the Zacks Consensus Estimate by 4.2%.

WST has an estimated long-term earnings growth rate of 16%. WST’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 17.4%.

The Cooper Companies, carrying a Zacks Rank #2 at present, reported a second-quarter fiscal 2026 adjusted EPS of $1.21, which beat the Zacks Consensus Estimate by 10%. Revenues of $1.08 billion beat the Zacks Consensus Estimate by 2.6%.

COO has an estimated long-term earnings growth rate of 8.3%. COO’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 5.8%.

Zacks' Research Chief Names "Stock Most Likely to Double"

Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.

This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research