Last year was already going to be a challenging one for AxoGen (AXGN), as this small-cap med-tech was recovering from past strategic missteps and execution issues stemming largely from trying to do too many things at once. Since refocusing on its core trauma opportunities results have improved, and as trauma cases increase on post-pandemic normalization, I expect those improvements to become more apparent.
Between trauma, breast reconstruction, and some surgical pain indications, I believe that AxoGen has addressable markets that can and will drive significant revenue growth in the coming years, growth backed in no small part by a differentiated product lineup that has a growing base of clinical data behind it.
The shares aren't the bargain they were when I last wrote about the stock, but I still like them. With the potential of 20%-growth over the next few years, a multiple of 7x or more to revenue does not seem unreasonable, supporting a fair value in the low-to-mid-$20's for the near term.
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Recovering Trauma Cases Should Highlight AxoGen's Improving Execution
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