STERIS plcSTE is gearing up to unveil its first-quarter fiscal 2025 results on Aug 6.

The Journey of Earnings Surprises

STERIS has a track record of surprising investors with its earnings performance. Over the past four quarters, it outperformed expectations three times and fell short once, with an average surprise of 2.21%.

In the previous quarter, the company reported adjusted earnings per share of $2.41, meeting the Zacks Consensus Estimate.

Anticipated Performance in Q1

Analysts estimate that STERIS’ first-quarter fiscal 2025 revenues will stand at $1.26 billion, reflecting a 1.7% decline from the corresponding period last year.

The consensus estimate for EPS of $2.03 indicates a modest 1.5% year-over-year growth.

Tracking Estimates Before Earnings

Projections for STERIS’ Q1 earnings have held steady at $2.03 per share in the last 30 days.

Now, let’s delve into the factors that might have shaped the company’s performance ahead of the earnings release.

Factors Impacting Performance

Healthcare Momentum

In the previous quarter, STERIS witnessed strong growth across its healthcare segments despite macro challenges. Positive pricing dynamics and enhanced productivity were key drivers. Such favorable conditions are likely to have continued in the first quarter of fiscal 2025.

The normalization of the Healthcare backlog and strategic restructuring initiatives are expected to further boost segment revenues by 7.1% compared to the prior year.

Applied Sterilization Technologies (AST)

Challenges stemming from inventory destocking and reduced customer demand were prevalent in recent quarters. However, signs of recovery in MedTech demand have emerged, with projections hinting at a 6.4% increase in AST segment revenues.

Life Sciences Outlook

The divestiture of the Controlled Environmental Services business within the Life Sciences segment will influence revenues in the current quarter. Despite this divestiture, the segment is expected to align with long-term projections.

Dental Segment Step

Notably, the recent sale of the Dental segment will impact STERIS’ financials, with one month of sales from this segment expected in the Q1 report.

Insights from Our Model

According to our model, a positive Earnings ESP coupled with a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) enhances the likelihood of beating estimates, a scenario not currently reflected in STERIS’ figures.

Earnings ESP: STERIS stands at 0.00%.

Zacks Rank: Presently, the company holds a Zacks Rank #2.

Exploring Potential Investment Opportunities

For investors seeking promising prospects, several medical stocks show promise in the earnings arena this reporting season.

Hims & Hers HealthHIMS and TransMedics GroupTMDX are among the companies poised for notable performances.

Each of these organizations has distinctive attributes that may lead to positive outcomes in the upcoming results.

Where do you see the needle pointing for STERIS and its peers in the upcoming earnings season?