Globus Medical Stock Revs Up For Next Move After 70% Run

Globus Medical (GMED) is Monday's selection for IBD 50 Stocks To Watch, as the medical device stock is in a newly formed flat base and showing bullish action. Globus Medical stock retook its 21-day exponential moving average after closing on it Friday. Shares were up more than 1% Monday in light volume.

The company makes medical implants including plates, screws and anchors for spine surgeries for patients with musculoskeletal disorders. It also manufactures biologic products including those used for stem cell treatment and bone grafts.

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Globus Medical is ranked No. 1 out of 126 stocks in the Medical-Products group, which holds the No. 70 spot out of the 197 groups Investor's Business Daily tracks.

Awaiting Catalyst For Next Move

The medical device maker is showing constructive tight closes in a flat base with a 87.22 buy point, according to MarketSurge pattern recognition. That entry is also its all-time high, which it touched on Dec. 2.

Shares are finding support at the 10-week moving average, which is considered constructive. Volume, however, has been mostly below average within the base.

Globus Medical stock gained around 70% from its May 7 breakout to its early December peak. Shares are around 3% below the record high.

Its Accumulation/Distribution Rating of B+ indicates fairly heavy institutional buying over the last 13 weeks. And its 1.5 Up/Down Volume Ratio shows positive demand over the last 50 days.

Globus Medical Stock: Steady Earnings

Globus beat third-quarter adjusted earnings and sales estimates on Nov. 5, and raised its full-year 2024 profit and revenue outlook. Globus expects 2024 revenue to be in the $2.49 billion to $2.50 billion range.

Its third-quarter earnings growth increased to 46% from 36% and 19% in the prior two quarters.

"We delivered meaningful sales growth across our portfolio and generated strong earnings growth, all of which delivered record operating and free cash results in the quarter, while continuing to invest for the long-term," Chief Financial Officer Keith Pfeil said in the earnings release.

Its third-quarter sales growth slowed to 63% after three straight triple-digit increasing quarters. But revenue estimates call for a dramatic slowdown in growth to a range of 3% to 7% over the next four quarters.

Analysts expected 28% profit growth for 2024 and 15% in 2025.

Report Schedule And Stock Ratings

The company is expected to report fourth-quarter results around mid-February.

Globus Medical stock holds a score of 11 out of 99 possible IBD Earnings Stability factor shows stable earnings over the last three years. A lower score in this metric is better.

It also boasts a 95 Earnings Per Share Rating. With that gauge, a higher score is better. A score of 99 is ideal.

Lastly, the medical device stock holds a robust 97 Composite Rating.

Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.

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