Morgan Stanley has added SI-Bone (NASDAQ:SIBN) to its checklist of high medtech picks within the small-to-medium capitalization area and upgraded NeuroPace (NPCE), however downgraded Stevanato (STVN), Sight Sciences (SGHT), Integra (IART) and Agiliti (AGTI).
The funding financial institution stated it chosen SI Bone for its high picks checklist partially for the corporate’s “multi-pronged progress story” and “skill to drive beats/raises.” It added that it now noticed a “clearer pathway” for the corporate to realize EBIDTA break-even. The financial institution has an obese score on the inventory, with a value goal of $30.
Morgan Stanley has additionally warmed as much as NeuroPace (NPCE), upgrading the inventory to equal weight, commenting that its prior underweight score had been primarily based on “persistent pandemic headwinds” that it now sees as waning. The financial institution additionally cited affected person funnel stabilization, improved volumes of the corporate’s RNS system and demonstrated price self-discipline.
The financial institution added it now had “greater conviction” in NeuroPace’s near-term industrial trajectory, noting that the corporate has additionally prolonged its money runway forward of a “key” scientific catalyst, the NAUTILUS research. The financial institution set a value goal of $6 for the inventory.
On the flip facet, Stevanato was downgraded to equal weight from obese, with the financial institution commenting that “market expectations have introduced shares near honest worth.” The financial institution’s value goal for the inventory is $34, noting that it has already rallied over 75% year-to-date.
Morgan Stanley stated it continued to see Stevanato reaching 10% topline progress over 2023 to 2025 and EBIDTA margins of 29% by 2025.
The funding financial institution additionally lowered its score on Sight Sciences to equal weight, pointing to a “heightened threat profile” because of reimbursement points for the corporate’s OMNI system for the remedy of glaucoma.
“Though we consider latest proposals shall be overturned, we expect the inventory now components on this expectation, even after falling round 30% since Might,” the financial institution stated in its word dated Aug. 24. Morgan Stanley lowered its value goal to $8.40.
Integra, which issued a recall earlier this 12 months for merchandise made at its Boston plant, was downgraded to underweight, because the financial institution noticed “restricted indicators of progress or profitability inflection” throughout the subsequent six to 12 months. Morgan Stanley has a value goal of $44 on the inventory.
Agiliti was likewise reduce to underweight, with the financial institution stating that whereas it had seen 2023 as a “transition 12 months” for the medical gear administration firm, “restoration and upside to profitability now seems to be extra labored.” The financial institution added that it noticed a “much less enticing profile” relative to the corporate’s friends and lowered its value goal to $10 from $15.
