Why Merit Medical Systems (MMSI) Stock Is Nosediving

What Happened?

Shares of medical device company Merit Medical Systems (NASDAQ:MMSI) fell 5.3% in the morning session after a regulatory filing made public showed that hedge fund Edgestream Partners L.P. had significantly reduced its position in the company. The disclosure, filed with the Securities and Exchange Commission, revealed that the fund had cut its holdings in the medical device maker by 40.8%. It is important for investors to note that the sale of 27,363 shares occurred during the first quarter, which ended March 31, 2025. The filing's release comes in the absence of other immediate negative company-specific news or analyst downgrades. The move follows a period of positive developments for Merit Medical, which earlier in July announced a new CEO and strong preliminary revenue growth for the second quarter.

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What Is The Market Telling Us

Merit Medical Systems’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.

The previous big move we wrote about was 8 days ago when the stock gained 4.6% on the news that Needham reiterated its "Buy" rating and a $108 price target on the stock. The analyst's reaffirmed confidence on July 8, 2025, signals a belief that the medical device company continues to be a solid investment. This comes on the heels of the company's announcement on July 7 that it had appointed Martha Aronson as its new President and CEO, with founder Fred Lampropoulos transitioning to Chairman of the Board. Adding to the positive sentiment, Merit Medical also released strong preliminary revenue results for the second quarter of 2025, expecting between $380 million and $384 million. The combination of leadership stability, strong preliminary sales, and bullish analyst sentiment appears to be driving investor optimism.

Merit Medical Systems is down 8.4% since the beginning of the year, and at $87.97 per share, it is trading 20.2% below its 52-week high of $110.29 from January 2025. Investors who bought $1,000 worth of Merit Medical Systems’s shares 5 years ago would now be looking at an investment worth $1,961.

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