Summary
NuVasive continues to gain share in the U.S., but international growth and margin leverage seem to be perennial concerns.
The new iGA platform and Ellipse acquisition look like share-driving innovation, but the company’s multi-pronged margin improvement strategy could be aggressive.
Revenue growth in the range of 7% and FCF growth in the mid-teens can support a DCF fair value of $48.50, with an even higher FV supportable through EV/revenue.
Not a lot has really changed for NuVasive (NASDAQ:NUVA). The third-largest spine company in the U.S. by market share, NuVasive continues to take share from larger players on the back of innovative products that offer meaningful advantages in terms of patient outcomes and surgeon convenience. On the other hand, concerns remain about the company’s weaker share and lower profits outside the U.S., the company’s position in biologics, and the real prospects for meaningful margin improvement in the coming years.
