Wright Medical Gets a New CEO - Analyst Blog
September 20 2011 - 10:45AM
Zacks
International orthopedic devices
company Wright Medical Group (WMGI) recently
reported that its Board of Directors chose Mr. Robert J. Palmisano
as President and CEO, starting from September 17, 2011. Mr. David
D. Stevens, who was interim President and CEO, will remain Chairman
of the Board.
Mr. Palmisano has notable expertise
managing important listed medtech companies. Until recently, he was
President and CEO of ev3. During his 2-year stint there, the market
capitalization of ev3 jumped more than three fold, from about $800
million in April 2008 to $2,600 million in July 2010.
Mr. Palmisano was President and CEO
of IntraLase Corp. prior to joining ev3. Still earlier, he was
President and CEO of MacroChem Corporation. He also served as
President and CEO of Summit Technology Inc. until it was taken over
by Alcon Inc (ACL). Mr. Palmisano occupied several
executive posts at Bausch & Lomb Incorporated between 1984 and
1996. He is at present a venture partner of SV Life Sciences and is
on the Board of Directors of Bausch & Lomb.
Wright Medical stated that as an
incentive for Mr. Palmisano’s leadership at the company, it had
authorized the grant of a stock option to him, which was made on
September 17, 2011, to buy up to 610,000 shares at an exercise
price of $16.03, subject to various terms and conditions.
As Mr. Palmisano assumes the
mantle, Wright Medical is for the time being withdrawing its
earlier released outlook for revenues and earnings. The company
will release updated data on revenues and earnings outlook at its
forthcoming third quarter earnings conference call.
Wright Medical Group is a global
orthopedic devices company specializing in the development and
marketing of reconstructive joint devices and bio-orthopedic
materials. It is a leader in the U.S. market for foot and ankle
surgical products. The company retains its strength in the niche
extremities segment.
We feel future revenue growth will
be supported by new product (including internally developed and
those from acquisitions) launches. During second-quarter 2011,
Wright Medical announced the commercial launch of new products for
the foot and ankle market including the INBONE II total ankle
replacement system. Moreover, new deals in extremities, Wright
Medical’s fastest growing segment, are expected to bolster growth
in this business. Within extremities, foot and ankle products are
expected to be a major growth driver.
However, our views are moderated by
lingering compliance issues and intense competition from larger
orthopedic players. Wright Medical competes with much larger
players such as Zimmer Holdings (ZMH),
Stryker (SYK), Johnson &
Johnson’s (JNJ) De Puy and Smith &
Nephew (SNN). Moreover, the company remains exposed to
pricing/procedure volume headwinds. We currently have a long-term
Neutral recommendation on the stock, backed by a short-term Zacks
#3 Rank (Hold).
JOHNSON & JOHNS (JNJ): Free Stock Analysis Report
SMITH & NEPHEW (SNN): Free Stock Analysis Report
STRYKER CORP (SYK): Free Stock Analysis Report
WRIGHT MEDICAL (WMGI): Free Stock Analysis Report
ZIMMER HOLDINGS (ZMH): Free Stock Analysis Report
Zacks Investment Research
Alcon (NYSE:ACL)
Historical Stock Chart
From Mar 2024 to Apr 2024
Alcon (NYSE:ACL)
Historical Stock Chart
From Apr 2023 to Apr 2024