That's an admittedly grim opening to an article on Wright Medical (NASDAQ:WMGI),
but it does feel like this company has been operating under one cloud
or another for quite some time. Prior to the hiring of CEO Bob
Palmisano, the company was weighed down with an uncompetitive large
joints business and an inefficient sales approach. Then there was a
protracted wrangling with the FDA over the Augment biological product.
Then there was the acquisition/merger with Tornier that, while promising
long-term, wasn't the high-premium buyout that some investors had been
counting on. Now there is the risk of product liability payouts,
potentially dilutive cash-raising moves, and the regular worries
associated with competition and the vagaries of the market.
Maybe there always is something to worry about with Wright Medical,
but that's true for most companies and it doesn't stand in the way of my
thinking that the shares remain undervalued. It will take some pretty
strong performance to justify a fair value in the $20s, but I think this
company has the technologies, products, and market foci to generate
that growth and make this a worthwhile stock over the long term.
Read the full article:
With Wright Medical, It Seems Like Something Always A Little Wrong
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