Smith & Nephew share price rises on upbeat Q2 statement
iNVEZZ.com, Friday, August 1: Shares in have advanced more than one percent in London after the artificial hips and knees maker revealed that its trading profit had surged in the second quarter.
As of 09:57 BST, Smith & Nephew’s share price had added 1.63 percent to 1,042.68p, outperforming the blue-chip FTSE 100 index which has slipped deep into the red this morning and currently stands 1.06 percent lower at 6,658.99 points.
**Trading profit picks up in second quarter**
Smith & Nephew reported today in a statement that its trading profit for the quarter ended June 28, 2014, had surged six percent year-on-year on an underlying basis to $255 million (£151 million). On a reported basis, the company’s trading profit was 10 percent up. Second-quarter revenue came in at $1.15 billion, three percent higher on an underlying basis, and seven percent up on a reported basis.
Smith & Nephew’s chief executive Olivier Bohuon commented in the statement that the results reflected “the execution of our strategy to rebalance the business towards higher growth markets”.
He also added that the company had completed the acquisition of ArthroCare. Smith & Nephew bought the US medical devices company earlier this year in a move to strengthen its sports medicine business. ( )
In today’s statement, Smith & Nephew reiterated its full-year outlook, noting that it anticipated the market conditions seen in the first half of 2014 to continue throughout the rest of the year.
**No shareholder pressure on deals**
Bloomberg today quoted Bohuon as pointing out that Smith & Nephew, a frequent subject of takeover speculation, was not facing shareholder pressure to accept any offers.
“We have been a significant target for the last 10 years,” Bohuon told reporters on a conference call. “Are we going to remain independent? It’s not up to me to tell you that. I don’t have any specific pressure from shareholders at this stage.”
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Earlier this year, news emerged that Medtronic Inc (NYSE:MDT), one of the world’s largest manufacturers of medical devices, was evaluating a bid for the UK company. Medtronic, however, subsequently opted for Ireland’s Covidien (NYSE:COV). In May, Stryker Corp’s (NYSE:SYK) chief executive confirmed that his company had been evaluating a bid for Smith & Nephew. ()
**Analysts on Smith & Nephew**
As of July 30, the consensus forecast amongst 35 polled investment analysts covering Smith & Nephew for the Financial Times advises that the company will outperform the market.
Analyst Ratings Network reports that the FTSE 100 artificial hips and knees maker currently has a consensus ‘hold’ rating and an average price target of 969p.
**As of 10:16 BST, buy Smith & Nephew shares at 1042.00p.**
**As of 10:16 BST, sell Smith & Nephew shares at 1040.00p.**