GMED Stock May Benefit Following the Acquisition of Nevro

Globus Medical, Inc. GMED recently completed its previously disclosed acquisition of Nevro Corp., a global medical device company that delivers comprehensive, life-changing solutions for the treatment of chronic pain.

The latest acquisition of Nevro expands Globus Medical's presence in the musculoskeletal market. 

Potential Trend of GMED Stock Following the News

Since the announcement on April 03, shares of Globus Medical have dropped 4.6%, closing at $72.02 last Thursday. On a positive note, the company is gaining market share in the musculoskeletal solutions space, fueled by the strong performance of its implantable devices, biologics, accessories and unique surgical instruments used in spinal, orthopedic and neurosurgical procedures. Reflecting on the robust synergies from the NuVasive merger, we anticipate that the latest acquisition should positively impact the market sentiment toward GMED stock.

Globus Medical has a market capitalization of $9.47 billion. Going by the Zacks Consensus Estimate, the company’s 2025 revenues are expected to surge 6.5% year over year. In the trailing four quarters, it delivered an average earnings surprise of 19.86%.

Importance of GMED’s New Acquisition

The transaction advances Globus Medical’s goal of becoming the premier musculoskeletal technology company globally, unlocking a $2.50 billion market opportunity. Nevro’s comprehensive HFX spinal cord stimulation (SCS) platform includes the Senza SCS system and support services for the treatment of chronic pain of the trunk and limb and painful diabetic neuropathy. The company also provides minimally invasive treatment options for patients suffering from chronic sacroiliac joint pain.

According to GMED administration, the deal allows them to expand into new markets for future growth while gaining access to Nevro’s world-class, differentiated technologies that can provide significant benefits in neuromodulation, enabling technologies and future implant solutions. Furthermore, the company’s scale and operational discipline will help optimize Nevro’s financial performance, driving enhanced profitability and creating long-term value.

Following the acquisition of Nevro, Globus Medical projects net sales to be in the range of $2.80-$2.90 billion (up from $2.66-$2.69 billion) for 2025. 

Industry Prospects Favoring GMED Stock

Per a report by Future Business Insights, the global orthopedic devices market was valued at $59.4 billion in 2023 and is expected to witness a compound annual growth rate of 5.3% through 2032. The market’s growth is driven by the rising prevalence of osteoporosis and musculoskeletal diseases, technological advancements, the increasing incidence of sports and traumatic injuries, and the growing aging population.

Another Development by GMED

Last month, Globus Medical launched the COHERE ALIF Spacer, the first Porous PEEK interbody spacer for anterior lumbar interbody fusion (ALIF) surgery. It features proprietary porous surface technology designed for bone in-growth while maintaining the imaging and mechanical properties favored in a solid PEEK interbody spacer. Additionally, the company introduced Modulus ALIF Blades, which is an extension of the widely recognized Modulus ALIF interbody spacer system. 

GMED Stock Price Performance

In the past year, shares of GMED have surged 29.5% against the industry’s decline of 18.8%.

GMED’s Zacks Rank and Key Picks

Globus Medical currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space are Masimo MASI, Boston Scientific BSX and Cardinal Health CAH. At present, Masimo sports a Zacks Rank #1 (Strong Buy), whereas Boston Scientific and Cardinal Health carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

Masimo’s shares have rallied 18.6% in the past year. Estimates for MASI’s 2024 earnings per share (EPS) have increased 1.2% to $4.10 in the past 30 days. MASI’s earnings beat estimates in each of the trailing four quarters, the average surprise being 17.1%. 

Estimates for Boston Scientific’s 2025 EPS have jumped 2.9% to $2.85 in the past 30 days. Shares of the company have surged 49.5% in the past year compared with the industry’s growth of 10.8%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.25%. 

Estimates for Cardinal Health’s fiscal 2025 EPS have increased 1.5% to $7.94 in the past 30 days. Shares of the company have jumped 23.9% in the past year against the industry’s 2.4% decline. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%. 

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This article originally published on Zacks Investment Research (zacks.com).

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