Morgan Stanley analyst Kallum Titchmarsh maintained a Buy rating on Globus Medical (GMED – Research Report) yesterday and set a price target of $100.00.
Kallum Titchmarsh has given his Buy rating due to a combination of factors, despite Globus Medical’s recent performance falling short of expectations. The company’s first-quarter results were below both sell-side and buy-side estimates, primarily due to temporary supply chain disruptions and unusual ordering patterns influenced by macroeconomic uncertainties. However, management remains optimistic about the potential of the NVRO acquisition, which, despite leading to a slight reduction in the full-year EPS guidance due to high SG&A expenses, is seen as a strategic opportunity.
Furthermore, there are positive signs of recovery, such as the completion of facility transitions and more normalized ordering patterns anticipated in the second quarter. Encouraging trends in robotic and imaging sales in recent months also contribute to the optimistic outlook. Additionally, the company’s efforts in price adjustments and vendor negotiations are expected to mitigate tariff impacts on margins in the coming years. These factors collectively support the Buy rating, as they indicate potential for recovery and growth in the medium term.
In another report released yesterday, Barclays also reiterated a Buy rating on the stock with a $103.00 price target.