Staar Surgical Co. surprised Wall Street earlier this month by saying its U.S. sales were taking off faster than expected.
The Lake Forest-based maker of implantable lenses for myopia, astigmatism and presbyopia (Nasdaq: STAA) on April 4 reported preliminary first-quarter revenue would top $77 million, when analysts were expecting $72 million.
Importantly, U.S. sales were expected to be $5 million, the company’s highest quarterly Implantable Collamer Lens (ICL) sales in the U.S. since it obtained Food and Drug Administration approval two years ago for its newest ICL product, called EVO.
“U.S. ICL sales were up approximately 20% sequentially to $5 million in the first quarter, which reflects early signs of our increased market focus,” Chief Executive Tom Frinzi said in a statement.
Frinzi also noted European sales climbed 11% while Asia-Pacific sales—by far its largest market—were up 9%. Frinzi said the company expects 2024 net sales at the higher end of a previously announced outlook range of $335 million to $340 million, implying a 3.9% to 5.5% growth rate.
Shares in Staar climbed 34% in the subsequent week to around $50 and a $2.4 billion market cap.
The company ranks No. 23 on this week’s list of Orange County’s largest medical device makers, with an estimated local base of 102 workers (see list, page 18).
Fortune Reversal
The April projections stand in stark contrast to last November, when company executives said initial U.S. growth would be slower than expected and the shares dropped 17% on one day alone. About 58% of Staar’s 2023 revenue of $322.4 million were in China while the U.S. accounted for about 5%.
Jefferies analyst Young Li is forecasting sales will accelerate 17% to $396 million in 2025 and another 19% to $469.3 million in 2026.
He increased his target price from $50 to $60 a share, implying a valuation of seven times 2025 sales.
Myopia Vision
Staar makes implantable eye lenses that compete with LASIK and lessen or eliminate the need for glasses or contact lenses.
Its key product is EVO ICL, which is a single-piece foldable phakic intraocular lens designed to correct myopia. The implant procedure typically takes 20 to 30 minutes per eye; Staar says it has quick recovery and little downtime typically.
Staar said myopia, also known as nearsightedness, is the most common ocular disorder worldwide. The constant staring at cellphones and computers may cause a rise in myopia from 28% of the global population to 50% by 2050, Staar has predicted.
Staar on April 2 said it has sold 3 million lenses since its founding more than 30 years ago.
The company has told investors it wants to boost that number to 6 million in 2026. It estimated the total addressable market is 180 million eyes.
Staar, which has its principal manufacturing facility in Monrovia, is expecting its Lake Forest headquarters will also serve as a future manufacturing site for its Evo Viva lenses, which assists certain patients by eliminating the need for reading glasses or frequent replacement contact lenses.
