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What: Shares of medical device company MAKO Surgical
So what: MAKO's stock has risen nicely in 2012, but lower-than-expected first-quarter sales -- $19.6 million versus the consensus of $23.7 million -- coupled with a full-year guidance cut is forcing Mr. Market to sober up quickly. While management's outlook isn't drastically lower, investors are nervous that slowing hip utilization trends set the company up for even more misses down the road.
Now what: Management now expects to sell 52 to 58 RIO systems in 2012, down from its previous sales view of 56 to 62 RIO systems. "On the positive side, we were encouraged by the continued interest shown in our hip application and the quality and quantity of clinical data that continues to be generated that supports the clinical and economic benefit of MAKOplasty," President and CEO Maurice Ferre, M.D., reassured investors. So while MAKO is certainly suffering through some growing pains, long-term investors should view today's huge pullback as a potentially profitable entry point.
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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of MAKO Surgical. Motley Fool newsletter services have recommended buying shares of MAKO Surgical. Try any of our Foolish newsletter services free for 30 days.