Heart Devices Focused Silk Road Medical Stock Gets an Upgrade - Analyst Says New CEO's Initiatives Sets Stage For 'Back On Track'

Stifel upgraded Silk Road Medical Inc SILK, noting the newly appointed CEO Chas McKhann’s first public speech at a major competitor healthcare conference, directly addressing/answering most of the concerns/uncertainties leading to Stifel’s downgrade in October.

Stifel notes McKhann presented a compelling vision to revive the SILK story, addressing investor concerns early on. 

The absence of a CEO and uncertainties about the commercial team contributed to two quarterly misses and a sales guidance cut in 2023, causing a significant stock drop of approximately 77% from its 52-week high. 

The analyst has upgraded Silk Road Medical stock from Hold to Buy with a price target of $20, up from the prior target of $9.

However, CEO McKhann’s reaffirmation of faith in minimally-invasive transcarotid artery revascularization (TCAR) technology, backed by SILK’s robust clinical data, and his strategic commercial initiatives focused on utilization inspire confidence. 

Despite acknowledging the potential for short-term challenges and the possibility of Consensus numbers adjusting downward, there is optimism about SILK’s long-term growth trajectory under McKhann’s leadership. 

Stifel writes that the CEO’s successful track record in creating shareholder value, particularly with the turnaround and sale of Apollo Endosurgery, reinforces confidence in SILK’s potential for recovery in 2024 and beyond. 

The belief in TCAR’s future remains strong, fueled by a clearer understanding of 2023 issues and CEO McKhann’s outlined plan for commercial improvement in 2024. 

Overall, the outlook for SILK appears positive for a resurgence “to get “back on track” throughout the unfolding year.

Price Action: SILK shares are up 13.60% at $14.97 on the last check Friday.

Photo via Company