BTIG initiated coverage of Misonix (NASDAQ:MSON) with a “buy” rating and $29 price target. The stock closed at $23.96 on June 11.
Misonix is a medical technology company focused on ultrasonic technology in a variety of markets. It recently acquired Solsys Medical, a privately held wound care company, which offers human tissue allografts.
“Collectively, we believe the combined company has all the pieces in place for sustainable growth (20%+); an expanded product portfolio that addresses large market opportunities; a significantly larger sales force with cross-selling opportunities; and a history of consistent execution by management,” writes analyst Ryan Zimmerman.
On base case assumptions, he expects the combined company to have net revenue of more than $80-million and gross margins above 70%.
While the ultrasonic technology market inside hospitals is competitive, Mr. Zimmerman said small share losses from larger players yields material gains for Misonix. And with Solsys adding some 600 accounts in the wound market, he said Misonix should be able to sell its ultrasonic technology into more niche areas in the wound market, potentially overlooked by competitors.
“Longer-term, we view the newest product, Nexus, as a platform technology that can take the ultrasonic application into a variety of new markets, such as sports medicine, plastic surgery, general surgery and others,” he added.
