Cantor Fitzgerald launched coverage of DarioHealth (NASDAQ:DRIO) with an “overweight” rating and price target of $35. The stock closed at $29.16 on Feb. 24.
Dario is a digital health company that is developing and commercializing proprietary technologies for patents with multiple chronic conditions to better manage their health. The company originally focused on selling diabetes testing capabilities direct to consumers but during the past year, it has begun to transition to a B2B2C model, with payers and employers as the target market.
“We view this transition positively and generally believe the company’s pivot is not necessarily appreciated by investors,” writes analyst Steven Halper.
In late January, the company announced the acquisition of Upright Technologies, which adds a proprietary musculoskeletal application to leverage its platform.
“With a large total addressable market, we believe DarioHealth is positioned for strong growth over the long-term,” Mr. Halper said. In addition, he said one of DarioHealth’s larger competitors, Livongo Health, was recently acquired by Teladoc for significantly higher valuation levels.
“We believe DarioHealth shares are attractive for small cap investors with a high growth orientation,” he added. “The company’s B2B2C strategy is beginning to pay dividends, and we are very positive on the recent acquisition of Upright. The company has added significant management talent lately, which in our view increases the probability of success.”
