By: Luke Hunneke, AIM Student at Marquette University
Disclosure: The AIM International Equity Fund currently holds this position. This article was written by myself, and it expresses my own opinions. I am not receiving compensation for it, and I have no business relationship with any company whose stock is mentioned in this article.
- Artivion, Inc. (NYSE:AORT) develops solutions that. Address cardiac and vascular surgeons’ clinical challenges in treating patients with aortic diseases.
- Artivion rebranded from Cryolife in Q4 2021. The Artivion name is derived from the words Aorta, Innovation, and Vision.
- YoY revenue growth for the On-X product segments and stents and graft segment is up 33%.
- Management’s near-term plan is to accelerate revenue growth through three initiatives; drive On-X growth while commercializing other products, expanding into Asia-Pacifc and Latin America by receiving regulatory approvals, and securing regulatory approvals for PerClot and. PROACT Mitral products.
Key points: Artivion, after a recent rebrand from the Cryolife brand, looks to capitalize on several factors that will affect revenue growth. Firstly, Artivion is focusing on maximizing several stent and graft products; AMDS, NEXUS, E-nside, and their new product, NEO. AMDS, the world’s first arch remodeling hybrid device for use in the treatment of acute Type A dissections. Revenues for AMDS have increased 20% YoY.
Artivion’s NEXUS product has also done extremely well, posting quarterly revenue increase YoY of 233%. Artivion is confident that a decline in COVID-19 infections will continue to increase the amount of non-COVID treatment in hospitals and will cause an uptick in NEXUS procedures in 2022. Artivion is also increasing their initiative to expand internationally in the Asia-Pacific and Latin America regions. The company has executed this strategy well so far, with quarterly revenues increasing in both regions by 29% and 34%, respectively. These regions are expected to be important contributors to Artivion’s future growth.
What has the stock done lately?
Artivion’s stock price has hovered around $18.00-$19.00 for the better part of 2021. February’s earnings call increased the stock price several dollars to $21.00 and the price has hovered at that range since. Artivion’s rebranding and several initiatives regarding new products and international expansion should excite investors. Artivion’s stock is up 25.53% over the past 3 months.
Past Year Performance: Artivion is down -.04% YoY, holding evenly with the Russell 2000 index. However, Artivion has performed much better than other similar healthcare companies, where the sector as a whole is down -13% YoY.
Artivion has done a lot to continue to increase their top line, and the introduction of several new products, including NEO, look to continue to do so. Artivion’s international initiative, if there are no regulatory problems, will also seek to provide revenue growth for Artivion. It is my opinion that Artivion be kept in the AIM Small Cap portfolio and classified as a Hold.