We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Globus Medical (GMED) Hits New 52-Week High: What's Driving It?
Read MoreHide Full Article
Globus Medical, Inc. (GMED - Free Report) scaled a new 52-week high of $78.15 on Jun 28, before closing the session marginally lower at $76.08.
The company’s shares have appreciated 63.4% over the past year, ahead of 25.3% growth of the industry it belongs to and 42.4% rise of the S&P 500 composite.
The company is witnessing an upward trend in its stock price, prompted by significant trend improvement amid post-pandemic recovery. The company’s strategy to focus on product development is encouraging. Moreover, the raised 2021 guidance buoys optimism in the stock. However, stiff competition and exposure to currency movement remain concerns.
Let us delve deeper.
Key Growth Catalysts
Prominent Trend Improvement: Following the initial pandemic-led downturn of the Globus Medical business, there has been a visible rebound in the company’s revenue trend that continued with a steady climb upward through the first quarter. In the quarter, revenues from enabling technologies surged 85.8% year over year. Given the challenging comps, the sequential improvement is more indicative of the healthy run of this business. As the economy returned to business in the third quarter, the capital teams were able to begin rebuilding pipelines and moving deals along. Many of these deals closed in October and enabled the company to sell more robots in October than it did for the entire third quarter.
Steady Pace of Product Development: In line with the company’s business strategy to focus on its integrated product development, Globus Medical is consistently making efforts to innovate plus research and develop. Per the company, its team-oriented approach, active surgeon input and demonstrated capabilities position it well to maintain a rapid rate of product launches. The company introduced two products during the first quarter – the first being CORBEL Lateral ALIF system comprising a novel retractor and an innovative interbody spacer. The second is CREO ONE, the market's first pedicle screw designed specifically for robotic spine surgery with ExcelsiusGPS.
Image Source: Zacks Investment Research
Raised Guidance: Investors are upbeat about the company’s raised guidance for full-year 2021. The company now expects full-year net sales at $925 million, calling for 5.1% growth from the previously guided figure of $880 million while adjusted earnings per share in 2021 is expected to be $1.89, suggesting 3.3% growth from the previously guided figure of $1.83.
Downsides
Competitive Landscape: The presence of a large number of players made the musculoskeletal devices market intensely competitive. The orthopedic industry in particular is highly competitive with the presence of larger players like Zimmer Biomet, Stryker, Johnson & Johnson’s DePuy, Smith & Nephew and Medtronic.
Exposure to Currency Movement: Globus Medical records 15.8% in sales from the international market. A significant portion of the company’s foreign revenues and expenses is generated in Japan, the Euro zone, the United Kingdom and Australia. This makes it highly vulnerable to currency fluctuations.
Zacks Rank and Key Picks
Currently, the company carries a Zacks Rank #3 (Hold).
Envista Holdings has an estimated long-term earnings growth rate of 26%.
BellRing Brands has an estimated long-term earnings growth rate of 22%.
IDEXX Laboratories has a projected long-term earnings growth rate of 20%.
+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities
In addition to the stocks you read about above, would you like to see Zacks’ top picks to capitalize on the Internet of Things (IoT)? It is one of the fastest-growing technologies in history, with an estimated 77 billion devices to be connected by 2025. That works out to 127 new devices per second.
Zacks has released a special report to help you capitalize on the Internet of Things’s exponential growth. It reveals 4 under-the-radar stocks that could be some of the most profitable holdings in your portfolio in 2021 and beyond.
Image: Bigstock
Globus Medical (GMED) Hits New 52-Week High: What's Driving It?
Globus Medical, Inc. (GMED - Free Report) scaled a new 52-week high of $78.15 on Jun 28, before closing the session marginally lower at $76.08.
The company’s shares have appreciated 63.4% over the past year, ahead of 25.3% growth of the industry it belongs to and 42.4% rise of the S&P 500 composite.
The company is witnessing an upward trend in its stock price, prompted by significant trend improvement amid post-pandemic recovery. The company’s strategy to focus on product development is encouraging. Moreover, the raised 2021 guidance buoys optimism in the stock. However, stiff competition and exposure to currency movement remain concerns.
Let us delve deeper.
Key Growth Catalysts
Prominent Trend Improvement: Following the initial pandemic-led downturn of the Globus Medical business, there has been a visible rebound in the company’s revenue trend that continued with a steady climb upward through the first quarter. In the quarter, revenues from enabling technologies surged 85.8% year over year. Given the challenging comps, the sequential improvement is more indicative of the healthy run of this business. As the economy returned to business in the third quarter, the capital teams were able to begin rebuilding pipelines and moving deals along. Many of these deals closed in October and enabled the company to sell more robots in October than it did for the entire third quarter.
Steady Pace of Product Development: In line with the company’s business strategy to focus on its integrated product development, Globus Medical is consistently making efforts to innovate plus research and develop. Per the company, its team-oriented approach, active surgeon input and demonstrated capabilities position it well to maintain a rapid rate of product launches. The company introduced two products during the first quarter – the first being CORBEL Lateral ALIF system comprising a novel retractor and an innovative interbody spacer. The second is CREO ONE, the market's first pedicle screw designed specifically for robotic spine surgery with ExcelsiusGPS.
Image Source: Zacks Investment Research
Raised Guidance: Investors are upbeat about the company’s raised guidance for full-year 2021. The company now expects full-year net sales at $925 million, calling for 5.1% growth from the previously guided figure of $880 million while adjusted earnings per share in 2021 is expected to be $1.89, suggesting 3.3% growth from the previously guided figure of $1.83.
Downsides
Competitive Landscape: The presence of a large number of players made the musculoskeletal devices market intensely competitive. The orthopedic industry in particular is highly competitive with the presence of larger players like Zimmer Biomet, Stryker, Johnson & Johnson’s DePuy, Smith & Nephew and Medtronic.
Exposure to Currency Movement: Globus Medical records 15.8% in sales from the international market. A significant portion of the company’s foreign revenues and expenses is generated in Japan, the Euro zone, the United Kingdom and Australia. This makes it highly vulnerable to currency fluctuations.
Zacks Rank and Key Picks
Currently, the company carries a Zacks Rank #3 (Hold).
A few better-ranked stocks from the broader medical space are Envista Holdings Corporation (NVST - Free Report) , BellRing Brands, Inc. (BRBR - Free Report) and IDEXX Laboratories, Inc. (IDXX - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of Zacks #1 Rank (Strong Buy) stocks here.
Envista Holdings has an estimated long-term earnings growth rate of 26%.
BellRing Brands has an estimated long-term earnings growth rate of 22%.
IDEXX Laboratories has a projected long-term earnings growth rate of 20%.
+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities
In addition to the stocks you read about above, would you like to see Zacks’ top picks to capitalize on the Internet of Things (IoT)? It is one of the fastest-growing technologies in history, with an estimated 77 billion devices to be connected by 2025. That works out to 127 new devices per second.
Zacks has released a special report to help you capitalize on the Internet of Things’s exponential growth. It reveals 4 under-the-radar stocks that could be some of the most profitable holdings in your portfolio in 2021 and beyond.
Click here to download this report FREE >>