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NuVasive (NUVA) Hits a New 52-Week High: What's Driving It?
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Shares of NuVasive, Inc. reached a new 52-week high of $69.28 on Mar 18, before closing the session marginally lower at $ 67.23. The stock has rallied 14.9% since its fourth-quarter earnings announcement on Feb 25.
The company is witnessing an uptrend in its stock price, prompted by strong international growth, led by the Asia Pacific during the fourth quarter of 2020. Recent organizational restructuring plan looks impressive. The huge growth potential in the spine market and strong prospects in NuVasive’s international business are added benefits. Moreover, the recent announcement by NuVasive to expand its long-term partnership with the International Spine Study Group Foundation buoys optimism. However, persistent pricing pressure and poor solvency structure remain a concern.
Let’s delve deeper
Key Growth Catalysts
Strong Global Performance: We are upbeat about NuVasive holding a tremendous growth opportunity in the international region. In fourth-quarter 2020, the company registered an uptick of 8% year over year in international revenues on a reported basis and a 4.6% rise at constant exchange rate or CER. This was led by strong contributions from the Asia Pacific, which were driven by product launches in the cervical portfolio and lower pandemic-led impacts.
Spine Market Prospects Bright: We are optimistic about the huge growth possibilities in the spine market and NuVasive is currently leaving no stone unturned to capture this fast-growing space.
To continue with the momentum in the thriving spine market, NuVasive recently extended its partnership with the International Spine Study Group Foundation through the launch of two clinical studies focused on enhancing patient outcomes in adult spinal deformity surgery.
Organizational Restructuring Plan Looks Impressive: NuVasive’s new organizational and leadership structure for its global commercial operations as well as its product and services instills investor confidence in the stock. According to the company, these changes establish a new global commercial leader and bring together NuVasive's product and services teams under a single stable. This new plan is expected to further advance the execution of NuVasive's long-term strategy and its growth goals including doubling of its international net sales by 2024.
Downsides
Poor Solvency Structure: NuVasive exited fourth-quarter 2020 with cash and cash equivalents, and short-term marketable securities of $1.03 billion. Meanwhile, total debt came up to $1.42 billion, marking an increase from the third-quarter 2020 level of $1.41 billion. The reported quarter’s total debt was much higher than the cash and cash equivalent, and short-term marketable securities level. Moreover, the quarter’s total debt-to-capital ratio of 60.6% stands at a moderately high level right now. The overall data concludes that in terms of solvency level, the picture is quite discouraging for the company.
Pricing Pressure Continues to Persist: NuVasive is exposed to pricing pressure headwinds as it experiences declining prices for its products due to increasing competition in the spine market.
Zacks Rank and Key Picks
Currently, NuVasive carries a Zacks Rank #4 (Sell).
Envista’s long-term earnings growth rate is estimated at 24%.
Meridian Bioscience’s long-term earnings growth rate is projected at 61%.
Owens & Minor’s long-term earnings growth rate is estimated at 49%.
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NuVasive (NUVA) Hits a New 52-Week High: What's Driving It?
Shares of NuVasive, Inc. reached a new 52-week high of $69.28 on Mar 18, before closing the session marginally lower at $ 67.23. The stock has rallied 14.9% since its fourth-quarter earnings announcement on Feb 25.
The company is witnessing an uptrend in its stock price, prompted by strong international growth, led by the Asia Pacific during the fourth quarter of 2020. Recent organizational restructuring plan looks impressive. The huge growth potential in the spine market and strong prospects in NuVasive’s international business are added benefits. Moreover, the recent announcement by NuVasive to expand its long-term partnership with the International Spine Study Group Foundation buoys optimism. However, persistent pricing pressure and poor solvency structure remain a concern.
Let’s delve deeper
Key Growth Catalysts
Strong Global Performance: We are upbeat about NuVasive holding a tremendous growth opportunity in the international region. In fourth-quarter 2020, the company registered an uptick of 8% year over year in international revenues on a reported basis and a 4.6% rise at constant exchange rate or CER. This was led by strong contributions from the Asia Pacific, which were driven by product launches in the cervical portfolio and lower pandemic-led impacts.
Spine Market Prospects Bright: We are optimistic about the huge growth possibilities in the spine market and NuVasive is currently leaving no stone unturned to capture this fast-growing space.
To continue with the momentum in the thriving spine market, NuVasive recently extended its partnership with the International Spine Study Group Foundation through the launch of two clinical studies focused on enhancing patient outcomes in adult spinal deformity surgery.
Organizational Restructuring Plan Looks Impressive: NuVasive’s new organizational and leadership structure for its global commercial operations as well as its product and services instills investor confidence in the stock. According to the company, these changes establish a new global commercial leader and bring together NuVasive's product and services teams under a single stable. This new plan is expected to further advance the execution of NuVasive's long-term strategy and its growth goals including doubling of its international net sales by 2024.
Downsides
Poor Solvency Structure: NuVasive exited fourth-quarter 2020 with cash and cash equivalents, and short-term marketable securities of $1.03 billion. Meanwhile, total debt came up to $1.42 billion, marking an increase from the third-quarter 2020 level of $1.41 billion. The reported quarter’s total debt was much higher than the cash and cash equivalent, and short-term marketable securities level. Moreover, the quarter’s total debt-to-capital ratio of 60.6% stands at a moderately high level right now. The overall data concludes that in terms of solvency level, the picture is quite discouraging for the company.
Pricing Pressure Continues to Persist: NuVasive is exposed to pricing pressure headwinds as it experiences declining prices for its products due to increasing competition in the spine market.
Zacks Rank and Key Picks
Currently, NuVasive carries a Zacks Rank #4 (Sell).
A few better-ranked stocks from the broader medical space are Envista Holdings Corporation (NVST - Free Report) , Meridian Bioscience Inc. and Owens & Minor, Inc. (OMI - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Envista’s long-term earnings growth rate is estimated at 24%.
Meridian Bioscience’s long-term earnings growth rate is projected at 61%.
Owens & Minor’s long-term earnings growth rate is estimated at 49%.
Bitcoin, Like the Internet Itself, Could Change Everything
Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities.
Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
See 3 crypto-related stocks now >>