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On Friday, Stifel analysts adjusted their expectations for Globus Medical (NYSE:GMED), reducing the price target on the company’s stock to $70 from the previous $94, while still maintaining a Buy rating. According to InvestingPro data, the stock currently trades at $72.46, with analyst targets ranging from $80 to $115, suggesting potential upside despite recent challenges. The revision follows a challenging first quarter for the medical device company, which saw a $30 million revenue and earnings per share (EPS) shortfall due to various integration-related issues. InvestingPro analysis indicates the stock is currently undervalued based on its proprietary Fair Value model.
Globus Medical’s first quarter of 2025 was marked by supply chain disruptions, delays in closing Expansion Technology (ET) deals, and irregular international distributor order timing. These factors collectively contributed to the revenue and EPS miss, which was approximately 5% lower than anticipated. Despite these setbacks, Globus Medical has reaffirmed its full-year revenue guidance, although it has revised its EPS forecast down by $0.10, reflecting the earlier than expected closure of the Nevro Corp . (NYSE:NVRO) acquisition. InvestingPro data shows the company maintains robust fundamentals with a healthy current ratio of 4.45 and impressive revenue growth of 32.26% over the last twelve months. For deeper insights into Globus Medical’s financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro.
In response to the first-quarter performance, Stifel analysts noted that such M&A-integration stories are often fraught with uneven periods and unexpected dislocations. They pointed out that while April showed signs of improvement with supply chain issues being resolved and ET deals closing, skepticism remains within the market. Investors and analysts alike are looking for a solid quarter that demonstrates the company is back on track before fully restoring confidence.
The analysts at Stifel have acknowledged the need to further scrutinize Globus Medical’s operations and risk profile in light of recent events. They remain committed to the investment narrative but have recalibrated their price target to reflect the increased risks. The new target of $70 represents a significant reduction from the prior target but still indicates a positive outlook on the stock’s potential performance.
Globus Medical’s stock performance and investor sentiment going forward will likely hinge on the company’s ability to address the outstanding questions and concerns raised by Stifel. The market will be closely monitoring the company’s subsequent quarters for signs of stability and consistent execution of its business strategy.
In other recent news, Globus Medical reported its financial results for the first quarter of 2025, revealing a shortfall in both earnings and revenue compared to forecasts. The company recorded an earnings per share of $0.68, below the anticipated $0.75, and revenue of $598.1 million, which fell short of the expected $631.09 million. Despite these results, Globus Medical achieved a record free cash flow of $141.2 million, marking a significant increase of 493% year-over-year. Additionally, the company has taken strategic steps to strengthen its position by launching two new products and acquiring Nevro for $250 million. The acquisition is expected to expand Globus Medical’s reach into the neuromodulation market. In terms of analyst activity, there were no specific upgrades or downgrades mentioned in the recent reports. The company reaffirmed its 2025 net sales guidance of $2.8 to $2.9 billion but adjusted its non-GAAP EPS guidance to $3.0 to $3.3. Despite operational challenges, Globus Medical remains optimistic about improvements in the upcoming quarters, particularly in spine and enabling technologies.
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