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Merit Medical Systems, Inc. MMSI, yesterday, announced its acquisition of Biolife Delaware, L.L.C. (Biolife) in a merger transaction. Through the deal, Biolife (which manufactures unique, patented hemostatic devices under the brand names StatSeal and WoundSeal) has become a wholly owned subsidiary of MMSI.
Merit Medical expects that the acquisition will position it to provide clinicians with more products designed to standardize, simplify and minimize post-procedure care and maintenance.
The company has also revised its full-year 2025 financial guidance to include the projected impact from this acquisition.
With the latest merger transaction, MMSI aims to boost its hemostasis product portfolio under the broader Cardiac Intervention (“CI”) business of the Cardiovascular segment and promote enhanced patient care.
Following the announcement, shares of the company gained nearly 0.7% till the last trading.
Historically, MMSI has gained a high level of synergies from its acquisitions. We expect market sentiment on the stock to remain positive around this announcement, too.
Merit Medical currently has a market capitalization of $5.81 billion. It has a return on equity of 15.5%, better than the industry’s 14.3%. In the last reported quarter, MMSI delivered an earnings surprise of 14.7%.
Per Merit Medical, its products operate through small openings on the skin that require efficient solutions to stop bleeding, help patients recover and minimize costly complications. In such cases, StatSeal specifically works with the patient’s blood to rapidly form a protective seal over the procedure site. Adding StatSeal to its hemostasis portfolio is intended to provide healthcare partners with an additional effective solution that complements a wide range of percutaneous procedures, including interventional radiology and cardiology, among others.
Per management, BioLife’s StatSeal and WoundSeal products, which address an estimated $350 million global market opportunity and are clinically validated, are expected to enhance its ability to deliver comprehensive solutions to customers.
Merit Medical has revised its full-year 2025 financial guidance to include the projected impact of the acquisition from the merger effective date of May 20, 2025 to Dec. 31, 2025. It has also reaffirmed its updated full-year 2025 financial guidance previously issued on April 24, 2025. Management expects to provide further details about the transaction in the second quarter of 2025 earnings report on July 30, 2025.
Per MMSI, the acquired assets are expected to contribute revenues in the range of $10-$11 million, primarily to the Cardiovascular segment, from the merger’s effective date of May 20, 2025 through Dec. 31, 2025. Management also projects the acquired assets to be dilutive to its full-year 2025 GAAP net income and GAAP earnings per share (EPS).
The acquisition is projected to be accretive to the adjusted gross and operating margins in 2025 and slightly accretive to adjusted net income and EPS in 2026. The acquisition is projected to be dilutive to Merit Medical’s GAAP net income and GAAP EPS in the first full-year post close and accretive thereafter.
Including the impact of the acquisition, Merit Medical now expects its net revenues for 2025 to be between $1.480 billion and $1.501 billion (reflecting an increase of 9.1-10.7% on a reported basis over the comparable reported figures of 2024), up from the previous outlook of $1.470 billion and $1.490 billion (reflecting an increase of 8.4-9.8% on a reported basis over the comparable reported figures of 2024). The Zacks Consensus Estimate is pegged at $1.48 billion.
Net revenues from the Cardiovascular segment are now expected to be in the range of $1.407 billion-$1.426 billion (representing an increase of 8-10% over the comparable reported figures of 2024), up from the previous outlook of $1.397 billion-$1.415 billion (representing an increase of 7-9% over the comparable reported figures of 2024).
The Endoscopy segment’s net revenues are continued to be projected between $73 million and $75 million (representing an increase of 34-37% over the comparable reported figures of 2024).
Adjusted EPS for 2025 is now projected to be in the range of $3.28-$3.41 (representing a decrease of 5-1% over the comparable reported figures of 2024), down from the prior outlook of $3.29-$3.42 (representing a decrease of 5-1% over the comparable reported figures of 2024). The Zacks Consensus Estimate is pegged at $3.35.
Per a report by Grand View Research, the global hemostasis and tissue sealing agents market was estimated at $8.67 billion in 2024 and is projected to expand at a CAGR of 9% between 2025 and 2030. Factors like increased demand supported by rising surgery volumes and growing demand for critical care among the elderly population due to their vulnerability to slow-healing injuries and wounds are likely to drive the market.
Given the market potential, the latest acquisition is expected to provide a significant boost to Merit Medical’s business.
This month, Merit Medical announced that the Wrapsody Cell-Impermeable Endoprosthesis received regulatory approval from Health Canada. With this approval, the company intends to begin immediate commercialization of the device throughout Canada.
Last month, MMSI reported its first-quarter 2025 results, wherein its Cardiovascular segment and CI product category recorded robust growth both on a reported basis and at constant exchange rate year over year. Per management, the CI category represented the largest driver of the Cardiovascular segment’s growth in the period, which was driven primarily by contributions from the acquisition of Cook Medical Products.
Shares of the company have rallied 18.4% in the past year compared with the industry’s 0.3% growth and the S&P 500’s rise of 11.5%.
Currently, Merit Medical carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader medical space are Hims & Hers Health, Inc. HIMS, Cencora, Inc. COR and Integer Holdings Corporation ITGR.
Hims & Hers, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 36.5%. HIMS’ earnings surpassed estimates in two of the trailing four quarters, missed once and broke even in the other, the average surprise being 19.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hims & Hers’ shares have surged 284.1% compared with the industry’s 19.6% growth in the past year.
Cencora, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 12.8%. COR’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6%.
Cencora has rallied 34.7% against the industry’s 18.7% decline in the past year.
Integer Holdings, sporting a Zacks Rank of 1 at present, has an estimated long-term growth rate of 18.4%. ITGR’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 2.8%.
Integer Holdings’ shares have declined 1.3% compared with the industry’s 13.2% plunge in the past year.
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This article originally published on Zacks Investment Research (zacks.com).
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Merit Medical acquires haemostatic device manufacturer Biolife for $120m
MMSI
Medical Device Network
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| May-20 |
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