Globus Medical Earns an Upgrade at BTIG, Shares Rise

Globus Medical Earns an Upgrade at BTIG, Shares Rise March 18, 2024, 11:12 a.m., readers: 7

Globus Medical (NYSE:GMED) shares rose more than 2% intra-day today after BTIG analysts upgraded the company to Buy from Neutral, setting a price target of $60. The analysts’ stance reflects a valuation based equally on P/E and EV/EBITDA ratios. After expressing skepticism over the past 9-12 months about the strategic fit and value of Globus Medical's acquisition of NuVasive, and mourning the loss of Globus's traditionally high adjusted EBITDA margins, the analysts now see the current stock valuation as more attractive, suggesting a favorable risk-reward balance. The analysts believe that the market's potential downside is limited and that, seven months post-merger, management has likely mitigated significant deal-related risks. As Globus Medical enters fiscal 2024, the analysts expect the company to benefit from a strong spine market and to start realizing cost synergies. The analysts consider the management's guidance conservative, factoring in significant sales dissynergies, but see potential for upside in EPS as NuVasive's cost structure is optimized. While they don't expect a return to mid-30% adjusted EBITDA margins, the analysts anticipate a clear margin improvement trajectory over the next 12-18 months as the company moves past the margin trough of fiscal 2023.

About NYSE: GMED

G lobus Medical, Inc., a medical device company, develops and commercializes healthcare solutions for patients with musculoskeletal disorders in the United States and internationally. It offers spine products, such as traditional fusion implants comprising pedicle screw and rod systems, plating systems, intervertebral spacers, and corpectomy devices for treating degenerative, deformity, tumors, and trauma conditions; treatment options for motion preservation technologies that consist of dynamic stabilization, total disc replacement, and interspinous distraction devices; interventional pain management solutions to treat vertebral compression fractures;

Price: 51.79
Market cap: 7.0 billion USD
Eps: 1.07
P/e ratio: 48.40
Focus Analysis On: GMED