It's been a great 12 months for Masimo Corporation (NASDAQ:MASI) shareholders. The maker of noninvasive-monitoring technologies saw its stock more than double during the period. Masimo also easily surpassed expectations in each of the quarterly results announced last year.

The company had another chance to impress investors with its fourth-quarter and full-year 2016 results announced after the market closed on Tuesday. Here are the highlights from Masimo's update. 

Pulse oximeter on finger with two hands shown

Image source: Getty Images.

Masimo results: The raw numbers

Metric

Q4 2016

Q4 2015

Year-Over-Year Change

Sales

$183.2 million

$167.3 million

9.5%

Net income from continuing operations

$215.3 million

$24.1 million

793.4%

Earnings per share

$3.97

$0.46

763%

Data source: Masimo. 

What happened with Masimo this quarter?

No, those earnings numbers from Masimo aren't mistakes. The company actually reported higher net income than sales during the fourth quarter. How? Masimo recorded a $270 million gain from its settlement with Koninklijke Philips (NYSE:PHG).

Even without that one-time gain, Masimo had a solid fourth quarter. Product revenue increased by 10% year over year to $175.7 million, bolstered by growing shipments of its SET and rainbow SET pulse oximeters. Royalty revenue held steady compared to 2015 at roughly $7.5 million.

Direct product sales were key to the company's success, growing 10.8% year over year and making up 87% of total product revenue. Original equipment manufacturer (OEM) sales grew 4.8% in the fourth quarter compared to the prior-year period.

Masimo also kept costs under control. The company reported operating expenses (excluding the one-time settlement gain) of $83.9 million. That's slightly below the $84.5 million in operating expenses net of one-time benefits recorded in the prior-year period.

For full-year 2016, Masimo announced revenue of $694.6 million, up 10.2% year over year. Net income for 2016 was $300.7 million, an increase of nearly 261%. That comparison was helped by the Philips settlement.

What management had to say

Masimo CEO Joe Kiani liked how his company fared in 2016 and particularly in the fourth quarter. Kiani said:

We are happy to report that we were able to finish the year on a very strong note as demand for our products throughout the world continues to increase with an especially strong fourth quarter in the U.S. Healthy product revenue growth, coupled with continued product margin expansion and controlled operating expenses, has allowed Masimo to achieve the highest quarterly operating income in our history. We are also very happy to report that our estimate of total worldwide installed base has for the first time ever exceeded 1.5 million SET Pulse Oximeters and rainbow SET Pulse CO-Oximeters.

Looking forward

The company provided fiscal 2017 guidance that should satisfy investors. Masimo expects 2017 revenue of around $752 million, and earnings per diluted share of $2.30.  

Masimo appears to be on track to continue its success into the future. The Philips settlement paved the way for the giant medical device company to use Masimo's technology in its products. The two companies plan to conduct joint marketing and sales in the U.S. and other countries. 

Perhaps the biggest risk for shareholders is that Masimo stock trades at a premium. Because of its high valuation, any bumps along the way could take their toll on the share price. For now, however, the road ahead appears to be pretty smooth.

Keith Speights has no position in any stocks mentioned. The Motley Fool recommends Masimo. The Motley Fool has a disclosure policy.