Globus is a medical device company focused exclusively on the design, development, and commercialization of products that
promote healing in patients with spine disorders.
All amounts in US$ unless otherwise noted
We maintain our BUY rating on shares of Globus following a mixed Q2/13. Best-in-class top-line growth (albeit a bit light vs expectations) combined with strong operating margins reinforce our thesis of Globus offering investors multiple opportunities to create value.
Our thesis remains intact and we are buyers of Globus on any weakness as the company is well positioned for growth in 2013 and beyond via continuous new product flow, distribution expansion and best-in-class financial discipline.
Q1/13 results of $107.0M/$0.21 were mixed relative to our and consensus estimates of $107.6M/$0.20 and $107.5M/$0.20.
Breakdown of Y/Y revenue growth in the Q2/13: Innovative fusion +3%, Disruptive technologies +26% Y/Y, US grew +11%, and International +20%. Innovative fusion drove upside vs our estimate.
New rep adds in 1H/13 in-line with all of 2012 with more to come.
Management reiterated 2013 guidance for revenues of $432M and EPS of $0.81.
We are raising our price target to $24.00 from $22.00 based on a 26.4x PE multiple applied to our 2014 EPS estimate of $0.92.