Globus Medical to acquire Nevro for $250 million

AUDUBON, Pa. - Globus Medical , Inc. (NYSE: NYSE:GMED), a prominent musculoskeletal solutions company with a market capitalization of $11.81 billion and an "GREAT" financial health rating according to InvestingPro, has agreed to purchase Nevro Corp . (NYSE: NYSE:NVRO), a global medical device firm specializing in chronic pain treatment, for approximately $250 million in cash. The acquisition, announced today, will see Globus Medical buy all outstanding shares of Nevro for $5.85 each.

The transaction price is a 27% premium over Nevro’s 90-day volume-weighted average price and a 17% premium to its closing market price on February 5, 2025. Both companies’ boards have unanimously approved the deal, which is slated to conclude late in the second quarter of 2025, pending shareholder and regulatory approval.

Globus Medical’s President and CEO, Dan Scavilla, expressed confidence that the acquisition will expedite the market penetration of Nevro’s technology and provide superior relief to patients with chronic pain. Nevro’s CEO, Kevin Thornal, also welcomed the merger, anticipating an enhanced global reach for their pain management products.

Prior to the announcement, Globus Medical reported preliminary 2024 sales of $2.52 billion, a 60.6% increase from the previous year, building on its impressive 102.1% revenue growth over the last twelve months. The company maintains strong financial metrics with a healthy current ratio of 2.51 and operates with moderate debt levels. Nevro posted preliminary revenues between $408 million and $409 million for the same period. According to InvestingPro, which offers comprehensive analysis of 1,400+ stocks, Globus Medical’s shares are currently trading near their Fair Value. Post-acquisition, Globus Medical forecasts 2025 net sales of $2.80 billion to $2.90 billion, with the transaction expected to be accretive to earnings in the second year.

The upcoming financial reporting will see Globus Medical release its full 2024 results and updated 2025 outlook on February 20, 2025, while Nevro will disclose its full-year 2024 financial results on March 4, 2025. Nevro will not hold an earnings call or provide 2025 guidance due to the pending acquisition.

Morgan Stanley (NYSE:MS) & Co. LLC and Wyrick Robbins Yates & Ponton LLP are advising Globus Medical, while BofA Securities, Inc. and Latham & Watkins LLP are advising Nevro.

This strategic move is expected to strengthen Globus Medical’s position in the musculoskeletal technology sector and enhance its product offerings in neuromodulation and pain management. With a gross profit margin of 67.05% and strong cash flows that sufficiently cover interest payments, the company appears well-positioned for this acquisition. For deeper insights into Globus Medical’s financial health and growth potential, investors can access detailed analysis and 15 additional ProTips through InvestingPro. The information for this article is based on a press release statement and InvestingPro data.

In other recent news, Globus Medical has been highlighted by financial analysts following its robust Q4 revenue results and optimistic projections for 2025. Canaccord Genuity maintained its Buy rating on the company, raising the price target to $101 from the previous $92, based on a 6.2% revenue growth forecast for 2025. Truist Securities also maintained its Hold rating, with a steady $90 price target, in response to the company’s strong Q4 performance and 2025 outlook.

BofA Securities upgraded Globus Medical from Underperform to Neutral, increasing the price target to $97 from $80, following the successful integration of NuVasive (NASDAQ:NUVA). The company’s Q4 revenue of $657 million exceeded Wall Street’s expectations by 3%. This performance, along with the company’s 2025 revenue guidance of between $2.66 billion and $2.69 billion, and earnings per share in the range of $3.40 to $3.50, were cited as indicators of the management’s confidence in meeting high cross-selling expectations.

RBC Capital Markets also expressed a bullish stance on Globus Medical, listing it among the top smid-cap picks for 2025 in the Medical (TASE:PMCN) Supplies & Devices sector. These recent developments reflect a positive outlook for Globus Medical’s growth trajectory and market position, as the company continues to exceed estimates and provide optimistic future guidance.

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