Cantor Fitzgerald Taps Spinal Stocks: 4 Top Picks

Spine stocks were steadied with supportive coverage from the Street this week. 

The Ratings

Cantor Fitzgerald analysts Craig Bijou and Jordan Abrams initiated coverage on:

• Globus Medical Inc GMED with an Overweight rating and $65 price target;
• K2M Group Holdings Inc KTWO with an Overweight rating and $28 price target;
• Orthofix International NV OFIX with an Overweight rating and $62 price target; and
• SeaSpine Holdings Corp SPNE with an Overweight rating and $16 price target.

They also initiated on Mazor Robotics Ltd - ADR MZOR and NuVasive, Inc. NUVA with Neutral ratings and respective targets of $57 and $54.

The Thesis

The analysts consider the spine segment — a $9-billion global opportunity — to be the largest orthopedic market and one of the biggest medical device end markets.

“While the spine market has faced a bevy of headwinds and challenges over the last 18 months that [have] suppressed growth, we believe that spine is still an important and relevant market,” Bijou and Abrams said in a note.

In the near-term, the analysts said they expect the Overweight-rated stocks to secure sales and seize share through their differentiated technology, appeal to surgeons and emphasis on growing niches around the spine.

Price Action

Orthofix closed up 1.4 percent Friday, while Globus, K2M and SeaSpine finished the session marginally higher.

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