Fresenius Medical Care AG & Co. FMS reported first-quarter 2025 adjusted earnings per share (EPS) of 44 cents, which surpassed the Zacks Consensus Estimate by 2.1%. The bottom line improved 22.2% year over year. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

FMS’ Revenue Details

Revenues of $5.14 billion (EUR 4,881 million) missed the Zacks Consensus Estimate by 2.2%. The company’s reported revenues increased 3.3% year over year and 1.2% at constant currency (cc). Also, revenues were up 5.4% organically.

Per management, during the first quarter, divestitures realized as part of the portfolio optimization plan affected revenue development by -260 basis points.

Shares of this company gained nearly 3.6% in today’s pre-market trading. The company’s shares have gained 21.1% year to date against the industry’s decline of 10.7%. The S&P 500 Index has decreased 5% in the same period.Zacks Investment Research

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Segmental Details

Fresenius Medical implemented a new operating model in 2024 and started reporting under two new segments, Care Delivery and Care Enablement.

Care Delivery

The segment’s revenues were up 1.8% on a year-over-year basis but down 0.9% at cc. However, revenues gained 4.2% on an organic basis.

Revenues in the U.S. markets improved 6.4% reportedly and gained 4.1% on an organic basis. The top line improved 3.2% year over year at cc. Per management,a growing value-based care business, reimbursement rate increases, and a favorable payor mix, as well as exchange rate effects, had a positive impact on the segment’s growth, compensating for a decrease in dialysis days.

Per management, during the first quarter of 2025, U.S. same-market treatment growth was flat year over year.

International sales declined 19.1% reportedly and 19% at cc but gained 4.8% on an organic basis. The decline was due to divestments realized as part of the portfolio optimization plan and a decrease in dialysis days, which was partially offset by organic growth. The organic growth was supported by accelerated same-market treatment growth of 2.5%.

Care Enablement

The segment’s revenues increased 5.4% year over year reportedly and 4.9% at cc as well as organically. The growth was driven by volume growth in all the company’s geographical regions and continued positive pricing momentum. Per management, volume-based procurement in China developed in line with expectations, supporting volume growth while acting as a headwind to price development.

Margin Analysis

In the quarter under review, Fresenius Medical’s gross profit improved 0.9% year over year. However, the gross margin contracted 60 basis points (bps) to 24.3%.

Story Continues

Selling, general & administrative expenses declined 3.2% on a reported basis. Research and development expenses decreased 9% year over year.

Adjusted operating income improved 11.4% from the prior-year quarter. The adjusted operating margin in the first quarter expanded 58 bps to 8%.

Fresenius Medical Care AG & Co. KGaA Price, Consensus and EPS SurpriseFresenius Medical Care AG & Co. KGaA Price, Consensus and EPS Surprise

Fresenius Medical Care AG & Co. KGaA price-consensus-eps-surprise-chart | Fresenius Medical Care AG & Co. KGaA Quote

2025 Guidance

In 2025, Fresenius Medical expects revenue growth to be positive, with a low-single-digit percent rate compared to the prior year. The company also expects operating income to grow by a high-teens to high-twenties percent rate compared to the prior year.

Our Take

FMS exited the first quarter on a mixed note, with its earnings and revenues surpassing and missing their respective consensus estimate. Overall pricing momentum also supported growth in the Care Enablement segment. However, the effects of elevated mortality will likely continue to have a negative impact on sales.

Per management, during the first quarter, the FME25 transformation program continued its positive momentum, delivering EUR 68 million additional sustainable savings while related one-time costs, treated as special items, amounted to EUR 28 million. The company confirmed its full-year target of around EUR 180 million in additional annual savings, totaling EUR 750 million by 2025-end.

The company’s continued divestment of its non-core and dilutive assets appears promising, as it will help focus on its core and growing categories, while also boosting its cash resources.

FMS’ Zacks Rank & Other Stocks to Consider

FMS carries a Zacks Rank #2 (Buy) at present.

Some other top-ranked stocks from the industry that have announced quarterly results are CVS Health Corporation CVS, Integer Holdings Corporation ITGR and Boston Scientific Corporation BSX.

CVS Health, carrying a Zacks Rank of 2, reported first-quarter 2025 adjusted EPS of $2.25, beating the Zacks Consensus Estimate by 31.6%. Revenues of $94.59 billion outpaced the consensus mark by 1.8%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

CVS Health has a long-term estimated growth rate of 11.4%. CVS’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 18.1%.

Integer Holdings reported first-quarter 2025 adjusted EPS of $1.31, beating the Zacks Consensus Estimate by 3.2%. Revenues of $437.4 million surpassed the Zacks Consensus Estimate by 1.3%. It currently sports a Zacks Rank #1.

Integer Holdings has a long-term estimated growth rate of 18.4%. ITGR’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 2.8%.

Boston Scientific reported first-quarter 2025 adjusted EPS of 75 cents, beating the Zacks Consensus Estimate by 11.9%. Revenues of $4.66 billion surpassed the Zacks Consensus Estimate by 2.3%. It currently carries a Zacks Rank #2.

Boston Scientific has a long-term estimated growth rate of 13.3%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.8%.

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Fresenius Medical Care AG & Co. KGaA (FMS):Free Stock Analysis Report

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

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