Please ensure Javascript is enabled for purposes of website accessibility

Why NuVasive, Inc. Stock Is Getting Crushed Today

By George Budwell - Mar 18, 2020 at 4:36PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

NuVasive's stock is getting unfairly punished by this moody market.

What happened

NuVasive, Inc. (NUVA 0.41%), a minimally invasive spinal surgery company, is having another rough day today. Specifically, the company's shares are down by 22% as of 3:01 p.m. EDT Wednesday afternoon.

NuVasive's shares are plunging in response to the rapid uptick in the number of COVID-19 cases in the United States. Making matters worse, the number of deaths worldwide also surged past the 8,700 mark in the past 24 hours, according to data from the World Health Organization. 

A roller coaster stock chart superimposed over a man with his head in his hands.

Image source: Getty Images.

So what

The spinal surgery giant's shares shot up by a healthy 56% in 2019. This year has been a different story altogether, however. Since the start of 2020, NuVasive's stock has shed a whopping 61% of its value. NuVasive's stock might be getting singled out for particularly harsh treatment because it was one of the most expensive equities -- from a forward-looking price-to-earnings ratio perspective -- in the entire healthcare sector at the start of the year. Nearly every healthcare stock that kicked off 2020 with a rich valuation is presently getting hammered by this rather moody market. 

Now what

Is NuVasive's stock a bargain after this hefty decline? The short answer is yes. The company's shares are now trading at a little over 1 time next year's projected sales. Even though the spinal surgery market may take a small hit from the COVID-19 outbreak, NuVasive probably isn't going to experience the kind of massive drop-off in revenue the market seems to be forecasting based on this dramatic sell-off. You simply can't put off a back surgery indefinitely. So, if you're bargain hunting today, NuVasive should arguably be at the top of your list. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

NuVasive, Inc. Stock Quote
NuVasive, Inc.
NUVA
$50.88 (0.41%) $0.21

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
336%
 
S&P 500 Returns
115%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/27/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.