Glaukos (GKOS) is a glaucoma treatment business headquartered in San Clemente, CA. The company’s stock is currently priced around $64 after soaring more than 16 percent last month. All in all, Glaukos has increased more than 110 percent across the past year. Let’s take a look at what is responsible for this boost and whether the stock can go even higher.
Glaukos has emerged as quite the intriguing company in the glaucoma space. Company executives describe their mission as developing and commercializing breakthrough surgical devices and therapies to treat glaucoma. The majority of Glaukos’ impressive February stock market performance can be attributed to its spectacular fourth quarter results.
Glaukos shares spiked nearly 10 percent the day after its quarterly results went public. Glaukos net revenue surpassed $54 million, a figure that represents a 30 percent bump on a year-over-year basis. This figure also represents a 23 percent sequential bump. Net sales increased 14 percent, breaching the $180 million threshold after coming in below the $160 million mark in the same quarter a year ago. Glaukos’ fourth quarter earnings per share (EPS) came in at 4 cents. This EPS is a 33 percent increase from the year prior. More importantly, Glaukos beat the street’s estimate by a considerable margin. Financial analysts far and wide anticipated a loss of 13 cents per share.
Glaukos’ most significant surge came this past August after news broke that top competitor Novartis would take its Cypass Micro-Stent glaucoma treatment off the market. Novartis’ creation proved ineffective after medical professionals had tried it to assist patients suffering from glaucoma. Glaukos’ stock spiked more than 40 percent on this news. JP Morgan quickly hiked its rating on the stock, shifting from neutral to overweight. Investors poured in the cash and Glaukos continued to climb. As a result of the company’s success, executives have preliminary issued a net sales guidance for next year of $230 million.
In the context of competition for market share, Glaukos’ iStent inject Trabecular Micro-Bypass System has proven quite important this past year. Company leaders attribute this product for helping expand the company’s global footprint that much more in 2018. Industry insiders insist more surgeons will choose Glaukos’ iStent Micro Bypass product now that Novartis’ Cypass Micro-Stent is no longer available.
Glaukos achieved everything it set out to do in 2018. Though the stock has been on a tear, there is no reason it cannot continue to go higher through the middle portion of 2019. Think of Glaukos as an airplane that has built up enough speed and momentum on the runway in preparation to take off. There is still time to catch a ride, especially if you follow this stock closely and time the market correctly.
Glaukos executives are reveling in the fact that the Food and Drug Administration (FDA) approved the company’s iStent inject for commercial launch well ahead of its initial timeline. Glaukos also scored a major victory in extending its pharmaceutical operations. The company scored a pharmaceutical development contract with D. Western Therapeutics Institute. Glaukos also recently got the ball rolling on clinical studies for its iStent infinite and iDose Travoprost products. Both of these products will be tested in important clinical studies based in the United States.
The icing on the cake is the fact that Glaukos’ patent portfolio continues to grow. More than 200 apparatus and method patents have been added to the company’s portfolio. The overarching aim of these additions is to enhance and protect the company’s current technological advancements for posterity’s sake.
For the most part, company executives have been pleased with surgeon responses to its latest products, especially its iStent inject. Glaukos will use the first half of the new year to zero in on the challenge of converting its current iStent implanters.
The hope is Glaukos’ success in the United States will be replicated in other markets around the world in due time. However, it does not appear as though a cure for glaucoma is coming through Glaukos’ pipeline or that of any other medical tech company in the near future. The question is how valuable Glaukos’ glaucoma treatments will become in the years ahead. Company leaders have done a good job of capturing additional market share in the past year, setting the stage for a successful 2019 and beyond. Look for Glaukos to move toward $70 in the months ahead.