SILK - Silk Road Medical falls after Medicare decision on stroke treatment
2023-07-12 08:48:02 ET
Silk Road Medical ( NASDAQ: SILK ) lost ~22% on Wednesday after the Centers for Medicare & Medicaid Services (CMS) proposed to revise coverage for a stroke treatment method used for carotid artery disease.
The Sunnyvale, California-based Silk Road Medical ( SILK ) offers a procedure called trans-carotid artery revascularization (TCAR) to treat carotid artery disease, competing against transfemoral carotid artery stenting (CAS) in the market.
CMS’s proposed National Coverage Determination (NCD) on Tuesday revises Medicare coverage for percutaneous transluminal angioplasty (PTA) of the carotid arteries concurrent with stenting (CAS) bringing CAS on par with TCAR for Medicare reimbursement.
Downgrading SILK to Neutral from Overweight and trimming its price target to $28 from $50, JPMorgan analyst Robbie Marcus argues that better reimbursements for CAS procedures and the firm’s Q1 miss bring into question "the achievability of 2024+ forecasts."
However, Citi reiterated the Buy rating and $48 per share target on the stock, noting that the NCD proposal will be subject to a 30-day comment period before a final decision is issued on October 10.
With Silk Road Medical ( SILK ) down ~40% YTD, analyst Joanne Wuensch argues that some investor concerns about the potential impact of a level playing field on TCAR procedures "should already be in the stock."
More on SILK
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Silk Road Medical falls after Medicare decision on stroke treatment