It’s a kinder, gentler FDA that the healthcare world is dealing with
these days, and while I don’t believe that’s an unalloyed positive for
the industry, the approval of the injectable version of Augment is
definitely a positive development for Wright Medical (WMGI).
Although the near-term impact to sales is likely to be on the order of
1% or so, the longer-term impact could be more significant. Coupled with
a strong upper extremity business that continues to gain share and a
lower extremity business that should see some re-acceleration in the
second half, Wright’s outlook is brightening. If the company can get
revenue growth back up to a double-digit pace, a 5x forward revenue
multiple and a fair value in the mid-$30s could be back in play in a
year, though I wouldn’t pay quite that much today.
Read the full article here:
FDA Approval Of Injectable Augment Should Give Wright Medical's Growth A Shot In The Arm
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