Analyst Michael Matson of Needham reiterated a Buy rating on Merit Medical Systems (MMSI – Research Report), with a price target of $88.00.
Michael Matson has given his Buy rating due to a combination of factors including Merit Medical Systems’ strong performance in the fourth quarter of 2023, as evidenced by their solid free cash flow. The company reported an increase in their organic revenue growth, which escalated from 7.1% in the third quarter to 8.3% in the fourth quarter. Additionally, Merit Medical showed significant improvement in both gross and operating margins, which went up by 90 basis points and 40 basis points year-over-year, respectively. This financial health is further supported by a sequential increase in free cash flow, primarily driven by enhancements in working capital.
Despite the company’s revenue guidance for 2024 being lower than the consensus, Matson views this forecast as conservative, suggesting there is potential for outperformance. Furthermore, the company’s Earnings Per Share (EPS) guidance encompassed the consensus estimates, demonstrating confidence in their earnings potential. Matson’s optimism is reflected in the raised price target for Merit Medical Systems’ stock, which he increased from $81 to $88. This adjustment is based on the anticipated earnings for 2025, indicating a belief in the company’s continued growth and profitability over the next few years.
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Merit Medical Systems (MMSI) Company Description:
Merit Medical Systems, Inc. engages in the manufacture and market of proprietary disposable medical devices. It operates through Cardiovascular and Endoscopy segments. The Cardiovascular segment consists of peripheral intervention, cardiac intervention, interventional oncology and spine, and cardiovascular and critical care product groups. The Endoscopy segment integrates advanced non-vascular stent technology with balloon dilators, inflation devices, guide wires, procedure kits, and other devices that are used by gastroenterologists, endoscopists, pulmonologists, and thoracic and general surgeons. The company was founded by Fred P. Lampropoulos, Darla Gill, Kent W. Stanger and William Padilla in July 1987 and is headquartered in South Jordan, UT.
Read More on MMSI:
- Merit Medical Systems Unveils Growth Plans in Earnings Call
- Merit Medical Reports Results For Fourth Quarter and Year Ended December 31, 2023 – Issues Fiscal Year 2024 Guidance
- Merit Medical Introduces “Continued Growth Initiatives” Program and Financial Targets for Three-Year Period Ending December 31, 2026
- MMSI Earnings this Week: How Will it Perform?
- Merit Medical Receives FDA 510(k) Clearance for SCOUT® MD™ Surgical Guidance System
