Needham Maintains a Buy Rating on NuVasive

By Carrie Williams

In a report released today, Michael Matson from Needham maintained a Buy rating on NuVasive (NASDAQ: NUVA), with a price target of $69. The company’s shares closed yesterday at $53.14.

Matson noted:

“NUVA’s 1Q18 revenue beat and EPS missed consensus. Management reiterated its 2018 revenue and EPS guidance. Organic revenue growth improved to 2% in 1Q18 from 0% in 4Q17 as US Spinal Hardware and biologics growth improved. NUVA’s revenue guidance requires it to accelerate its revenue growth; we believe that it can do this given new products, easing comps, and stabilization of biologics. And its EPS guidance requires a substantial improvement in its gross and operating margin; we believe it can do this with improvements in its new manufacturing plant and SG&A leverage. Unfortunately, both the revenue and margin ramps are likely to continue to make NUVA a “show me” story despite its discount P/E multiple.”

According to TipRanks.com, Matson is a 5-star analyst with an average return of 8.8% and a 60.6% success rate. Matson covers the Healthcare sector, focusing on stocks such as Boston Scientific Corp, Cardiovascular Systems, and Zimmer Biomet Holdings.

Currently, the analyst consensus on NuVasive is Moderate Buy and the average price target is $63.90, representing a 20.2% upside.

In a report released yesterday, BTIG also assigned a Buy rating to the stock with a $72 price target.

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NuVasive’s market cap is currently $2.72B and has a P/E ratio of 34.51. The company has a book value ratio of 3.4185.

Based on the recent corporate insider activity of 19 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of NUVA in relation to earlier this year.

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NuVasive, Inc. engages in the development of minimally-disruptive surgical products and procedurally-integrated solutions for spine surgery. It offers cervical and spine fusion surgery, cervical plating, and posterior fixation products. The company was founded by Alexis V. Lukianov on July 21, 1997 and is headquartered in San Diego, CA.