Analysts Offer Insights on Healthcare Companies: Irhythm Technologies (NASDAQ: IRTC), Wright Medical Group (NASDAQ: WMGI) and Humana Inc. (NYSE: HUM)

Companies in the Healthcare sector have received a lot of coverage today as analysts weigh in on Irhythm Technologies (NASDAQ: IRTC), Wright Medical Group (NASDAQ: WMGI) and Humana Inc. (NYSE: HUM).

Irhythm Technologies (NASDAQ: IRTC)

In a report released today, Jason Mills from Canaccord Genuity reiterated a Buy rating on Irhythm Technologies (NASDAQ: IRTC), with a price target of $31. The company’s shares closed last Friday at $24.23.

Mills noted:

“We initiate coverage with a BUY, seeing material upside potential as IRTC drives a paradigm change from “analog to digital” in ambulatory electrocardiography (ECG) monitoring. The firm’s proprietary ZIO XT wearable biosensor records and stores continuous data up to 14 days – significantly longer than gold-standard Holter monitors (avg. 1-2 days), and more cost effective than event recorders or implantable loop recorders – while delivering very high diagnostic yield. IRTC is just scratching the surface of the 4.6+ million ECG procedure TAM, with ~4% share.”

According to TipRanks.com, Mills is a 2-star analyst with an average return of 0.0% and a 52.6% success rate. Mills covers the Healthcare sector, focusing on stocks such as Integer Holdings Corporation, Tactile Systems Technology, and Trivascular Technologies.

Currently, the analyst consensus on Irhythm Technologies is Strong Buy and the average price target is $30, representing a 23.8% upside.

In a report released today, J.P. Morgan also initiated coverage with a Buy rating on the stock with a $34 price target.
Wright Medical Group (NASDAQ: WMGI)

UBS analyst Matt Miksic reiterated a Buy rating on Wright Medical Group (NASDAQ: WMGI) yesterday and set a price target of $31. The company’s shares closed last Friday at $23.46.

Miksic noted:

“We hosted a call with WMGI President & CEO Robert Palmisano and EVP & CFO Lance Berry on Monday, November 7. (Replay will be available through 11/14 at: (800) 633 – 8284, passcode: 21820888). We include the transcript of the call on Page 3 of this note (please also see our take-aways published on Nov 8). We expect the company to be able to manage the remaining liability post the settlement through operating cash flows and cash on hand. More importantly, we’re increasingly confident in management’s ability to drive top-line growth in the mid-teens, gross margins in the high seventies, and EBITDA margins approaching 20% over the next 2-3 years. We reiterate our Buy rating and $31 price target on small-cap top-pick WMGI. Upper extremities driven by new products, improving productivity WMGI continues to take share in the shoulder replacement market, driven by the company’s differentiated Simpliciti shoulder and continued U.S. mix shift to reverse shoulders. Going forward management sees an opportunity to drive annual sales productivity for upper extremities from the $600-700,000 range closer to the ~$1.2 mil annual run rate per rep the company achieves in lower extremities.”

According to TipRanks.com, Miksic is a 4-star analyst with an average return of 9.5% and a 53.5% success rate. Miksic covers the Healthcare sector, focusing on stocks such as Dentsply International Inc., Boston Scientific Corp., and Obalon Therapeutics Inc.

Currently, the analyst consensus on Wright Medical Group is Strong Buy and the average price target is $28.17, representing a 20.1% upside.

In a report issued on November 3, Barclays also reiterated a Buy rating on the stock with a $33 price target.
Humana Inc. (NYSE: HUM)

UBS analyst A.J. Rice reiterated a Hold rating on Humana Inc. (NYSE: HUM) on November 11 and set a price target of $194. The company’s shares closed last Friday at $193.19, close to its 52-week high of $196.45.

Rice noted:

“Additional Color on HUM’s HIF Pause benefit Comment HUM disclosed in its 10-Q that the company paid out $916 mln in September 2016 to the federal government for its portion of the annual health insurance industry fee attributed to calendar year 2016. The company noted along with its 3Q earnings release that it would recognize a tax benefit of $2.20/share on a Y/Y basis related to the HIF pause, which based on 151 mln diluted share count translates to a tax benefit of roughly $332 mln. The Y/Y tailwind of the remaining benefit of $584 mln on pre-tax earnings is incorporated into HUM’s business commentary/outlook for next year. Update on Statutory Capital, Subsidiary Dividends, & Portfolio Duration Based on the most recently filed statutory financial statements, as of June 30, 2016, HUM’s state regulated subsidiaries had aggregate statutory capital and surplus of approximately $6.1 bln, exceeding aggregate minimum regulatory requirements of $4.7 bln. Humana paid $663 mln in dividends to its parent company during the first nine months ended Sept 30, 2016 compared to $463 mln the same time a year ago. The average duration of HUM’s investment portfolio, including cash and cash equivalents, was approximately 3.0 years as of Sept 30, 2016 and approximately 4.1 years at Dec 31, 2015. Based on the duration, including cash equivalents, a 1% increase in interest rates would generally decrease the fair value of securities by approximately $500 mln at Sept 30, 2016.”

According to TipRanks.com, Rice is ranked 0 out of 5 stars with an average return of -7.2% and a 40.0% success rate. Rice covers the Healthcare sector, focusing on stocks such as Quest Diagnostics Inc., Envision Healthcare, and Kindred Healthcare.

Currently, the analyst consensus on Humana Inc. is Moderate Buy and the average price target is $207.29, representing a 7.3% upside.

In a report issued on November 7, Barclays also reiterated a Hold rating on the stock with a $191 price target.