Several medical device companies took hits yesterday after analysts on Wall Street downgraded their stocks, on a day when the major market indices each closed up a hair, and even medtech firms that enjoyed upgrades came under pressure.
Globus Medical (NYSE:GMED) suffered the most after Morgan Stanley analyst David Lewis cut his rating on the stock from “overweight” to “equal-weight,” sliding -8.5% to a $39.61-per-share close yesterday, compared with the prior day’s closing price.
In fact, Lewis’s downgrades led the pack in terms of impact, taking Insulet (NSDQ:PODD) and Hologic (NSDQ:HOLX) shares down some -7.4% and -6.5%, respectively. Here’s a look at some of yesterday’s downgrade action:
| DOWNGRADES | |||||
| Company | Analyst | Old rating | New rating | Close 1/2/19 | % |
| Globus (GMED) | Morgan Stanley | Overweight | Equal-Weight | $39.61 | -8.5% |
| Insulet (PODD) | Morgan Stanley | Hold | Hold* | $73.43 | -7.4% |
| Hologic (HOLX) | Morgan Stanley | Equal-Weight | Under-Weight | $38.42 | -6.5% |
| Abbott (ABT) | Citigroup | Neutral | Sell | $69.50 | -3.9% |
| Medtronic (MDT) | Citigroup | Buy | Neutral | $87.92 | -3.3% |
| Henry Schein (HSIC) | Robert W. Baird | Outperform | Neutral | $76.39 | -2.7% |
| Smith & Nephew (SNN) | JP Morgan | Overweight | Neutral | $36.40 | -2.6% |
| Bayer (BAYN) | JP Morgan | Overweight | Neutral | $17.40 | -1.0% |
| *cut price target | |||||
The upgrade picture was murkier, with a trio of medical device companies taking hits despite upgrades, but three others gaining (including a bullish move from Lewis on shares of Baxter (NYSE:BAX)):
| UPGRADES | |||||
| Company | Analyst | Old rating | New rating | Close 1/2/2019 | % |
| Tactile Systems (TCMD) | Northland Capital | Under Perform | Market Perform | $44.59 | -2.1% |
| Stryker (SYK) | Evercore ISI | In-line | Outperform | $154.50 | -1.4% |
| Zimmer Biomet (ZBH) | Citigroup | Neutral | Buy | $102.28 | -1.4% |
| Bausch Health (BHC) | Piper Jaffray | Neutral | Overweight | $20.23 | 0.1% |
| Baxter (BAX) | Morgan Stanley | Under-Weight | Overweight | $65.30 | 0.8% |
| Citigroup | Neutral | Buy | |||
| Apollo Endosurgery (APEN) | Northland Capital | Under Perform | Market Perform | $3.65 | 5.8% |
By way of comparison, the three major U.S. market indices all closed up a hair yesterday, with the Dow Jones Industrial Average closing up 0.1% at 23,346.24. The S&P 500 also closed up 0.1%, at 2,510.03, and the NASDAQ index ended at 6,665.94, up 0.5%.
