Piper Jaffray Upgrades Wright Medical (WMGI) to Overweight

Piper Jaffray upgraded Wright Medical (NASDAQ: WMGI) from Neutral to Overweight with a price target of $23.00, citing favorable risk/reward.

Analyst Matt O'Brien commented, "After a long spell on the sidelines, we upgrade WMGI shares from Neutral to Overweight. Although litigation risk remains, the likelihood of a massive, near-term payout is modest, in our view. The recent convertible offering should be the last capital raise the company needs and allow it to more aggressively negotiate a potential settlement in its hip lawsuit. Beyond that, we continue to believe the fundamental performance of the business remains strong (with upside to ’16 and ’17 sales and EBITDA existing) and the growth profile at WMGI should improve as it sheds the legacy Tornier hip and knee business in a few months. Based on all these factors and a palatable valuation of 3.4x ’17E revenue, our view on the name has turned constructive and we recommend purchasing the name here."

For an analyst ratings summary and ratings history on Wright Medical click here. For more ratings news on Wright Medical click here.

Shares of Wright Medical closed at $20.52 yesterday.

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