Merit Medical Systems, Inc. MMSI announced positive six-month findings from the single-arm Arteriovenous Graft (AVG) cohort of its WRAPSODY Arteriovenous Access Efficacy (WAVE) pivotal trial yesterday. The WAVE trial was designed to assess the efficacy and safety of the WRAPSODY device.
The WRAPSODY Cell-Impermeable Endoprosthesis is currently not approved or available for commercial distribution in the United States. It may also not be approved or available for sale or use in other countries. However, the device is available in Brazil and in the European Union.
In the United States, the device is being used under an Investigational Device Exemption from the FDA. Per management, the findings from the WAVE trial expand on results from the first-in-human trial (WRAPSODY FIRST) and support the premarket approval application to the FDA for commercial use in the United States.
The announcement of the latest favorable findings from the WAVE pivotal trial is a significant stepping stone for Merit Medical, which is likely to strengthen its foothold in the global hemodialysis space.
Likely Trend of MMSI Stock Following the News
Following the announcement on Nov. 25, shares of the company lost nearly 0.4% at yesterday’s closing.
Historically, the company has gained a high level of synergies from its various product launches and positive trial outcomes. Although the announcement of the latest favorable findings from the WAVE pivotal trial is likely to be beneficial for MMSI’s top-line growth going forward, the stock declined overall despite a slight gain till Friday.
Merit Medical currently has a market capitalization of $6.12 billion. Its projected earnings per share growth of 11.6% is higher than the industry’s 7.5%. In the last reported quarter, MMSI delivered an earnings surprise of 7.5%.
Significance of Merit Medical’s Positive Trial Outcome
An AVG is a synthetic tube that is used for long-term access to blood vessels for patients undergoing hemodialysis. However, over time, the graft may become narrow or blocked, resulting in potentially life-threatening consequences. Per management, Merit Medical’s WRAPSODY Cell-Impermeable Endoprosthesis has been designed to restore and extend vessel access (patency) in hemodialysis patients, which is critical for patient survival.
Per an expert associated with the trial, given the historically low patency rates for AVG patients, the favorable results from the AVG arm of the WAVE trial are encouraging for physicians who manage these patients.
Merit Medical has been collaborating with physician partners to improve care for hemodialysis patients, and expanded its product offering and focus on these patients. The WRAPSODY device is an important part of this growing portfolio.
Industry Prospects in Favor of MMSI
Per a report by Allied Market Research, the global hemodialysis market was valued at $76.9 billion in 2022 and is anticipated to reach $111.8 billion by 2032 at a CAGR of 3.8%. Factors like the growing awareness regarding hemodialysis and the increasing prevalence of chronic cardiac diseases and end-stage renal disease are likely to drive the market.
Given the market potential, the latest announcement of a positive trial outcome is expected to solidify Merit Medical’s foothold in the niche space.
Merit Medical’s Notable Development
In September, MMSI announced positive six-month findings from the randomized arteriovenous fistula arm of its WRAPSODY WAVE pivotal trial. The data were shown at the Cardiovascular and Interventional Radiological Society of Europe.
MMSI’s Share Price Performance
Shares of the company have gained 46.2% in the past year compared with the industry’s 9.1% rise and the S&P 500's 31.6% growth.
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Merit Medical’s Zacks Rank & Other Key Picks
Currently, MMSI carries a Zacks Rank #2 (Buy).
A few other top-ranked stocks in the broader medical space are Cardinal Health, Inc. CAH, Cencora, Inc. COR and Globus Medical, Inc. GMED.
Cardinal Health, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 10.2%. CAH’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 11.2%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cardinal Health’s shares have gained 14.4% compared with the industry’s 9.1% rise in the past year.
Cencora, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 10.1%. COR’s earnings surpassed estimates in each of the trailing four quarters, with the average being 6.9%.
Cencora has gained 21% against the industry’s 1% decline in the past year.
Globus Medical, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 14.1%. GMED’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 17.7%.
Globus Medical’s shares have rallied 82.9% compared with the industry’s 15.1% rise in the past year.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>Cardinal Health, Inc. (CAH) : Free Stock Analysis Report
Merit Medical Systems, Inc. (MMSI) : Free Stock Analysis Report
Cencora, Inc. (COR) : Free Stock Analysis Report
Globus Medical, Inc. (GMED) : Free Stock Analysis Report
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