Globus Medical GMED has skilled sturdy upward momentum prior to now 12 months, with its shares rising 41.8%. This has far outpaced the industry’s 7.5% decline and the S&P 500 composite’s 8.8% progress.
At present carrying a Zacks Rank #3 (Maintain), this famend medical gadget firm is gaining from the sturdy demand for its musculoskeletal resolution merchandise. The mixed Globus Medical-NuVasive firm is unlocking important synergies, with extra room to develop internationally. Furthermore, the inventory additionally advantages from a gradual tempo of latest product introductions.
Headquartered in Audubon, PA, Globus Medical has an intensive portfolio comprising superior and differentiated applied sciences which are used to deal with quite a lot of musculoskeletal situations of the backbone, extremities and pelvis. The corporate presently has its gross sales operations distributed throughout 66 counties worldwide. Via the NuVasive Merger, it has expanded its international industrial attain, elevated operational capabilities and additional enhanced its complete choices of Musculoskeletal Options and Enabling Applied sciences.
Key Catalysts for GMED
The rally within the share worth will be linked to the corporate gaining momentum within the musculoskeletal options market. In current quarters, Globus Medical has outpaced the market progress within the U.S. backbone enterprise, fueled by mixed product choices, aggressive rep recruiting from prior quarters and elevated implant utilization by means of robotic pull-through. Within the fourth quarter of 2024, musculoskeletal gross sales improved 4.5% 12 months over 12 months, pushed by sturdy features in its worldwide backbone enterprise and a 43.5% improve in international Enabling Applied sciences revenues.
Picture Supply: Zacks Funding Analysis
Moreover, the corporate’s newest deal to accumulate Nevro Company expands its footprint within the musculoskeletal area by an extra $2 billion. With its strong monetary place, Globus Medical is well-positioned to speed up investments in neuromodulation to develop each its present product lineup and future improvements. Furthermore, the merger with NuVasive, accomplished in September 2023, has remodeled the corporate into a world musculoskeletal powerhouse targeted on speedy innovation, addressing unmet scientific wants, and enhancing choices to surgeons and sufferers.
On the finish of the fourth quarter, the mixed firm surpassed its 2024 synergy targets and was in a position to speed up worth creation and shareholder return because of this. For the second 12 months’s synergies, the corporate is efficiently implementing widespread programs within the worldwide markets, increasing its in-house manufacturing for NuVasive implants, consolidating the exterior distributors and using its current product choices to drive cross-selling. Even so, Globus Medical sees main untapped potential in its mixed product choices internationally, anticipating it to be a major tailwind in 2025 and past.
Moreover, product launches have quickly accelerated following the NuVasive integration. In 2024, the corporate launched 18 new merchandise, together with the ExcelsiusHub and the ExcelsiusFlex surgical navigation system. Globus Medical’s excessive R&D spending pattern is indicative of a wholesome pipeline, with a spread of latest merchandise in numerous levels of improvement.
GMED’s Issues
Globus Medical is presently grappling with destructive traits within the international financial system, together with rate of interest fluctuations, will increase in inflation and monetary market volatility. Specifically, the growing geopolitical complexities are driving up the uncooked materials and freight prices for the corporate, limiting its profitability.
A Look at GMED’s Estimates
The Zacks Consensus Estimate for Globus Medical’s 2025 and 2026 earnings per share (EPS) is anticipated to extend 13.5% and 15.1% 12 months over 12 months, respectively, to $3.45 and $3.97. Up to now 30 days, the Zacks Consensus Estimate for the corporate’s 2025 EPS has dropped by 2 cents.
Revenues for 2025 are projected to develop 6.5% to $2.68 billion, whereas the identical for 2026 is anticipated to achieve $2.87 billion, reflecting a 7% improve.
Key MedTech Shares
Some better-ranked shares within the broader medical area are Veracyte VCYT, Hims & Hers Well being HIMS and Boston Scientific BSX.
Veracyte has an earnings yield of three.6% in opposition to the trade’s -3.3% yield. The corporate’s earnings surpassed the Zacks Consensus Estimate in every of the trailing 4 quarters, with the typical shock being 515.9%. Its shares have gained 47.4% in opposition to the trade’s 7.6% decline prior to now 12 months.
VCYT carries a Zacks Rank #2 (Purchase) at current. You’ll be able to see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hims & Hers Well being, carrying a Zacks Rank #2 at current, has an earnings yield of 1.9% in opposition to the trade’s -7.6%. Shares of the corporate have gained 97% in opposition to the trade’s 12.4% decline. HIMS’ earnings surpassed estimates in three of the trailing 4 quarters and missed on one event, the typical shock being 40.4%.
Boston Scientific, carrying a Zacks Rank #2 at current, has a long-term estimated earnings progress charge of 13.3%. Shares of the corporate have surged 50.3% in contrast with the trade’s 10.2% progress. BSX’s earnings surpassed estimates in every of the trailing 4 quarters, with the typical shock being 8.3%.
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Boston Scientific Corporation (BSX) : Free Stock Analysis Report
Globus Medical, Inc. (GMED) : Free Stock Analysis Report
Veracyte, Inc. (VCYT) : Free Stock Analysis Report
Hims & Hers Health, Inc. (HIMS) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the creator and don’t essentially mirror these of Nasdaq, Inc.
