BTIG Sees Limited Upside For Globus Medical, Downgrades To Neutral

Globus Medical Inc GMED is up 64 percent year-over-year, but it may be exhausting its potential.

The Rating

BTIG analyst Ryan Zimmerman downgraded Globus Medical to Neutral.

The Thesis

Globus Medical is seen to have ridden intensified investor interest in robotics, which compounded strong fundamentals, a positive year in core spine sales, and a good first quarter for robotics commercialization.

BTIG doesn’t necessarily expect the firm to take a turn for the worse.

“We are not saying 1Q18 will miss with our downgrade today either as we believe there may still be early pent-up demand for ExcelsiusGPS in 1Q,” Zimmerman wrote in a Monday note. “In fact, we believe GMED could beat expectations for the quarter.”

He just doesn’t see much upside — perhaps “a dollar or two” — considering overextended valuation relative to the group and the tailwind of robotics growth already baked into the price.

Price Action

Globus Medical fell more than 1 percent on the downgrade, and at time of publication was trading around $50.11.

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