The Street Still Highly Skeptical On AxoGen's Growth Story

It’s rough for investors when institutions change their mind about growth sectors, and the performance of some smaller high-growth med-techs over the past year illustrates that, with Abiomed (ABMD), AxoGen (AXGN), Avanos (AVNS), Inogen (INGN), and Nevro (NVRO) among some of the names that are down substantially from a year ago as the market has shifted away from what was at the time a long-term peak valuation for the sector.

Of course, it’s not just sector allocation that matters, and AxoGen has had some of its own challenges, including a late 2018 short report that rattled investors, a miss in Q4, an enrollment expansion in a key clinical study, and ongoing uncertainty about the real size of the peripheral nerve repair market and AxoGen’s ability to emerge as a long-term winner.

I’ve chosen to shift to much more conservative modeling assumptions, including lower sales force productivity, more competitive pressure, and a slower path toward converting surgeons into active users of nerve conduit products. Even with those changes, though, I still believe AxoGen can generate better than 20% long-term revenue growth and support a fair value in in the $30’s.

Continue here:
The Street Still Highly Skeptical On AxoGen's Growth Story