SRDX

U.S. M&A Activity Decline: U.S.-based mergers and acquisitions (M&A) saw no growth in the first quarter compared to last year, while regions like the Middle East, Africa, Japan, and Asia experienced significant increases in M&A volume.

Recent Acquisitions and Sales: Notable transactions include Rocket Companies acquiring Mr. Cooper Group for $9.4 billion, Hershey's acquisition of snack brand LesserEvil for around $750 million, and Hooters filing for bankruptcy protection while selling its restaurants to franchisees.

Introduction of Pounce™ XL Thrombectomy System: Surmodics, Inc. has launched the Pounce™ XL Thrombectomy System for removing thrombi and emboli from peripheral arteries (5.5–10 mm), enhancing their existing thrombectomy platform that includes systems for smaller vessel sizes.

Clinical Effectiveness and Safety: The Pounce Thrombectomy Platform is designed for rapid, non-surgical clot removal with low risk of complications, supported by positive interim results from a study showing effective treatment of limb ischemia in patients without significant adverse events.

Raizen's Portfolio Revision: Raizen, a Brazilian joint venture between Shell and Cosan, is exploring the sale of its Argentinian oil refinery and gas station network as part of a significant portfolio revision, according to CEO Nelson Gomes.

M&A Activity and Regulatory Challenges: Walgreens Boots Alliance may go private through a $10 billion deal, while American Express plans to acquire Center. Meanwhile, the FTC is blocking GTCR's acquisition of Surmodics due to concerns over market control, reflecting a slowdown in M&A activity amid regulatory scrutiny.

Surmodics Stock Reaction: Surmodics, Inc. shares fell 4.76% in premarket trading after the FTC announced it would challenge GTCR LLC's proposed acquisition of the company, citing concerns over market concentration in hydrophilic coatings used in medical devices.

Company Response and Merger Details: Surmodics disagrees with the FTC's decision and plans to defend the merger, which was agreed upon on May 29, 2024, at a valuation of approximately $627 million, aiming to benefit stakeholders despite regulatory hurdles.

FTC Challenges Merger: Surmodics, Inc. disagrees with the FTC's decision to challenge its proposed acquisition by GTCR-affiliated funds, asserting that the merger is pro-competitive and beneficial for stakeholders.

Merger Details: The merger agreement, valued at approximately $627 million, was approved by Surmodics' shareholders and will result in Surmodics becoming a privately held company, with plans to vigorously defend against the FTC's litigation.

FTC Challenges Merger: Surmodics, Inc. disagrees with the FTC's decision to challenge its proposed acquisition by GTCR LLC, asserting that the merger is pro-competitive and beneficial for stakeholders. The company plans to defend the case vigorously in court.

Merger Details: Surmodics has a definitive agreement to be acquired for $43.00 per share, totaling approximately $627 million, which will make it a privately held company after completion. The merger was approved by shareholders but faces regulatory hurdles due to the FTC's litigation.

FTC Blocks Merger: The U.S. Federal Trade Commission (FTC) has sued to block Surmodics' acquisition by GTCR, citing concerns that it would lead to higher healthcare costs and reduce competition in the market for hydrophilic coatings used in medical devices.

Impact on Healthcare Costs: FTC Chairman Andrew Ferguson emphasized that the merger would exacerbate existing high healthcare costs, highlighting the importance of maintaining competition to drive down prices and improve healthcare access for Americans.

FTC Blocks Merger: The U.S. Federal Trade Commission has sued to block Surmodics' acquisition by GTCR, citing concerns that the merger would lead to higher healthcare costs and reduce competition in the market for hydrophilic coatings used in medical devices.

Impact on Healthcare Costs: The FTC argues that the merger would eliminate competition with Biocoat, which has driven innovation and lower prices, and emphasizes its commitment to protecting competition in healthcare markets under the Trump administration.

Regulatory Challenges for Surmodics: Surmodics' stock fell by 0.7% as it prepares to meet with regulators this week regarding its planned $627 million sale to private equity firm GTCR, amid recommendations from FTC staff to block the deal due to market dominance concerns.

Timeline and Expectations: The merger received a second request from the FTC in August, with Surmodics indicating that the deal is expected to conclude before February 28, as per the merger agreement.

Oversold Stocks in Healthcare: The healthcare sector has several oversold stocks with low RSI values, indicating potential buying opportunities for undervalued companies like Radiopharm Theranostics (RADX), Surmodics Inc (SRDX), and Merck & Co Inc (MRK).

Recent Stock Performance: RADX's stock fell 11% recently, SRDX reported a 15% drop over the past month, and MRK's shares decreased by 10%, despite positive earnings reports, highlighting volatility in the market.

Successful Clinical Use of Pounce XL Thrombectomy System: Surmodics, Inc. announced the early clinical use of its Pounce™ XL Thrombectomy System, which received FDA clearance in September 2024 and is designed for non-surgical removal of thrombi from peripheral arteries, with a successful first case reported by Dr. Walter Rizzoni at UPMC Hamot.

Pounce Thrombectomy Platform Overview: The Pounce Thrombectomy Platform includes three systems for varying vessel sizes, emphasizing ease of use and rapid clot removal without the need for thrombolytics, aiming to reduce hospitalizations and follow-up procedures as indicated by positive early user feedback.

Analyst Rating: Barrington analyst Michael Petusky has maintained a Hold rating on SurModics (SRDX) stock due to mixed Q1 results and uncertainty surrounding the company's pending acquisition by GTCR, which faces regulatory hurdles.

Insider Activity: Recent corporate insider activity indicates negative sentiment towards SRDX, with an increase in insiders selling their shares compared to earlier this year.

Financial Performance: Surmodics, Inc. reported a total revenue of $29.9 million for the first quarter of fiscal 2025, a decrease of 2% year-over-year, with a GAAP net loss of $(3.7) million compared to $(0.8) million in the previous year.

Merger and Product Developments: The company is in the process of being acquired by GTCR for approximately $627 million, while also announcing FDA clearance for its Pounce™ XL Thrombectomy System and positive early results from its PROWL registry study.

Financial Performance: Surmodics reported a Q1 non-GAAP EPS of -$0.04 and revenue of $29.9 million, reflecting a 2.3% year-over-year decline.

Market Reaction: The company's stock fell following news about the FTC's review of its planned sale to GTCR.

Stock Performance Overview: SRDX's stock has a 52-week low of $25.17 and a high of $42.44, with the last trade recorded at $38.30.

Market Insights: The article hints at other stocks that have recently fallen below their 200-day moving average, indicating potential market trends.

Zacks Rank #1 Stocks: Five stocks have been added to the Zacks Rank #1 (Strong Buy) List, including Under Armour, BellRing Brands, RB Global, Surmodics, and Coterra Energy, all showing positive earnings estimate trends over the past 60 days.

Investment Recommendations: Zacks experts highlight a company targeting millennial and Gen Z audiences as a potential stock to skyrocket, with a recent pullback making it an opportune time for investment.

Ongoing Litigation Risk: SurModics Inc. is facing significant legal challenges from shareholders alleging misleading proxy statements regarding a merger, which could delay or prevent the merger and lead to financial liabilities.

Market Consensus: Wall Street has a Hold consensus rating on SurModics Inc. (SRDX) stock, reflecting cautious sentiment among analysts.

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Financial Performance: Surmodics, Inc. reported a 19% increase in total revenue for Q4 fiscal 2024, totaling $33.2 million, but faced a GAAP net loss of $(3.4) million compared to a profit of $6.7 million in the same period last year. For the full fiscal year, total revenue decreased by 5% to $126.1 million with a net loss of $(11.5) million.

Acquisition and Product Developments: The company is set to be acquired by GTCR for $43 per share, pending regulatory approval, while also announcing FDA clearance for its Pounce™ XL Thrombectomy System, which expands its market reach in medical devices.

Study Results: An early analysis of 60 patients with limb ischemia using the Pounce™ Thrombectomy System showed a 96.8% success rate in restoring blood flow, with 81.7% of patients not requiring further treatment within 30 days post-procedure.

Registry Overview: The PROWL registry is collecting data on the efficacy and safety of the Pounce Thrombectomy Platform for non-surgical removal of emboli and thrombi in peripheral arteries, aiming to enroll up to 500 patients across multiple sites.