Stryker's Q2 Results Likely to Reflect Recovery of Q1 Deferred Orders

The Zacks Consensus Estimate for earnings is pegged at $3.46 per share, indicating an increase of 10.5% year over year.

The consensus mark for revenues is pinned at $6.56 billion, implying growth of 8.9% from the prior-year reported figure.

Factors to Note

Stryker is expected to report another quarter of healthy underlying performance, supported by resilient procedural demand, continued robotic surgery adoption and strong capital equipment orders. While the company’s first-quarter results were significantly disrupted by a cyber incident that delayed shipments and revenue recognition, management emphasized that underlying market demand remained healthy and reaffirmed full-year organic sales growth guidance of 8-9.5%.

The upcoming quarterly results are likely to reflect the initial recovery from deferred first-quarter revenues, particularly from revenue recognition catch-up in Orthopaedics, while additional recovery from delayed capital equipment shipments is also expected to continue through the second half of the year.

Within the Orthopaedics segment, growth is likely to have been supported by robust procedural volumes, continued market share gains and sustained momentum for the Mako robotic platform. The company delivered a record first quarter for Mako installations despite the cyber disruption, with utilization rates continuing to improve globally.

New product launches, including Mako 4, Mako Shoulder, Mako RPS and Triathlon Gold, are expected to have supported customer interest, while the recently formed Ortho Tech business should have improved commercial execution by combining Mako, enabling technologies and orthopaedic instruments under one organization. Trauma is also likely to have benefited from continued adoption of the Pangea plating system, with European approvals providing an additional growth opportunity.

The MedSurg and Neurotechnology segment is expected to have experienced a more gradual recovery, as capital-intensive businesses such as Medical and Endoscopy were more heavily affected by production shutdowns during the cyber incident. Management indicated that delayed manufacturing of made-to-order products, including beds and other capital equipment, would primarily recover during the second half of the year. Nevertheless, underlying hospital capital spending remains healthy, with an elevated order backlog supporting demand. Continued adoption of LIFEPAK 35, Smart Hospital solutions integrating Vocera and care.ai, and upcoming launches such as Sonopet 4 should provide additional growth support.

Meanwhile, margins are expected to improve sequentially as production normalizes, although tariff-related costs and higher input prices may continue to weigh on gross margin. First-quarter profitability was pressured by lower manufacturing absorption, tariffs and higher interest expense following the Inari acquisition.

However, management maintained its full-year adjusted EPS guidance of $14.90-$15.10, reflecting confidence that deferred revenue recovery, continued pricing discipline, manufacturing efficiencies and operational excellence initiatives will offset near-term cost headwinds as the year progresses.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Stryker this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here, as you will see below.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00% for SYK. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Zacks Rank: The company carries a Zacks Rank #3 at present.

SYK’s Share Price Performance

So far this year, Stryker’s shares have lost 6% compared with the industry’s 20.4% decline. The S&P 500 has gained 7.5% during the said period.

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Stocks Worth a Look

Here are some stocks worth considering from the broader medical sector, as these have the right combination of elements to post an earnings beat this reporting cycle.

Cardinal Health CAH has an Earnings ESP of +1.24% and a Zacks Rank #2 at present. The company is set to release fourth-quarter fiscal 2026 results on Aug. 11. You can see the complete list of today’s Zacks #1 Rankstocks here.

CAH’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 10.27%. The Zacks Consensus Estimate for CAH’s fourth-quarter EPS indicates an improvement of 16.4% from the year-ago reported figure.

Henry Schein HSIC has an Earnings ESP of +0.41% and a Zacks Rank #3 (Hold) at present. The company is scheduled to release second-quarter 2026 results on Aug. 4.

HSIC’s earnings surpassed estimates in three of the trailing four quarters and missed once, with the average surprise being 3.74%. The Zacks Consensus Estimate for HSIC’s second-quarter EPS implies an improvement of 10.9% from the year-ago reported figure.

Agilent Technologies A has an Earnings ESP of +1.02% and a Zacks Rank of 3 at present.

A’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 1.61%. The Zacks Consensus Estimate for A’s third-quarter fiscal 2026 EPS calls for an improvement of 8% from the year-ago reported figure.

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