Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Masimo
So what: The agreement is an extension of an agreement signed in 2006 and will pay Masimo 7.75% of sales in the United States. Masimo said it might invest 50% of the royalty payments into further growth of its business.
Now what: The increased certainty is great news for Masimo, and continued investment in the business should be seen as a positive. At a price-to-earnings multiple of 26, shares trade a little richer than I would like given current performance. I'll wait to buy shares until I see a pullback in shares or more positive news when the company releases earnings on Feb. 15.
Interested in more info on Masimo? Add it to your watchlist.
