Masimo Corporation got approval on their patent, filed Dec 7, 2007, for the Plethysmograph
Variability Processor. This processor triggers blood flow to a given tissue
site to calculate different variables and indicators to determine conditions of
blood & blood flow, as well as seeing how efficient specific treatments are
for these conditions. On another note,
Janney Montgomery Scott initiated coverage on Masimo with a BUY rating and a target price of $26.00 a share, further solidifying the UASBIG BUY rating and 12M
price target of $26.23.
The accumulation of good
news, heightened with a strong market, helped Masimo rally up 1.9% at open to $19.40, opposed to a previous closing price of $19.04. It traded at a high today of $20.35, a gain of 6.9%. The rally
eventually cooled down and the stock ended $20.29 a share, representing a daily
gain of 6.6%, beating the S&P500 gain of 1.2%.
Although Masimo is down YTD by 343 basis points, there is much more
expected growth as more hospitals begin to implement their products. Within a
span of only a couple weeks, three different hospitals have implemented new
Masimo systems mainly because of the efficiency and cost effectiveness to both
the patient and the provider. The most recent to implement Masimo devices is
East Tennessee Children’s Hospital, one of only four hospitals in its state certified
as a Comprehensive Regional Pediatric Center. East Tennessee Children’s
Hospital has given insight on possibly expanding the Patient SafetyNet into
different units of the hospital. With new accelerated acceptance of the Masimo
product, our thesis is further affirmed for the long term growth of Masimo.
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