Top Picks 2018: Integra Life Sciences Holdings (IART)

01/05/2018 5:00 am EST

Focus: HEALTHCARE

David Toung

Senior Analyst: Medical Devices & Healthcare Services, Argus Research Corporation

Integra Life Sciences Holdings Corp. (IART) is a leader in medical implants and instruments for neurosurgery, tissue regeneration and wound care, explains David Toung, analyst with Argus Research.

This company is a leader in medical implants and instruments for neurosurgery, tissue regeneration and wound care.

The company's products are used in cranial and spinal procedures, peripheral nerve repair, small bone and joint injuries, and the repair and reconstruction of soft tissue.

We believe Integra is positioned to benefit from a bounce-back in procedural volumes in 2018 following hurricane-related outages impacting 2017.

We also have a positive view of the October 2017 Codman acquisition, which added neurosurgery products and expanded overseas sales.

I A RT trades at 20.6-times our 2018 EPS estimate, above the average of 19.1 for peers in our med-tech coverage universe.

However, we believe this premium is warranted given Integra's strong sales growth, steady flow of new products, success in integrating acquisitions, and rising margins.

As the smallest med-tech company in our coverage universe (by market cap), Integra is also 'moving the needle' on revenue and EPS growth from its recent M&A deals.

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