Poor Atlas, the Titan giant has been burdened with holding up Globus’ spirits as the company attempts to finalize its initial public offering. “Oy vey,” Atlas is going to get tired from carrying Globus’ around during this dog and pony show. With all the hoopla surrounding a potential IPO, it seems Globus had to put the brakes on its original intent, so that it could up the ante from $100 million to $150 million. Hopefully the consultants from the Great Vampire Squid, Piper Jaffray, BOFA, et al will fare better than the genius’ at Morgan Stanley that led the Face-broke sham. Price this right and you will attract investors, get greedy and the repercussions will come back and bite you in the ass. Think Alpha Wreck. Considering that investor confidence is at an all time low in light of the recent Facebroke fiasco it will be interesting to evaluate how the Globus IPO plays out. If one takes the time out to read the preliminaries in the S-1 filing, Globus has done a nice job in managing its finances when it comes down to running a company. Of course those that have become collateral damage during the process will say otherwise. But the reality is that at this juncture its all about the financial data that counts. If anyone wonders why the Street sunk its teeth into medical devices look no further. In what other industry can a company generate on average 81% gross margins across the board? Containing COGS at 19% speaks volumes about production efficiencies at Globus. In addition, Globus has been able to stabilize their SG&A costs at 42% over the last few years, a sign that it has moved away from total independent distribution model. TSB anticipates that the SG&A will eventually come down a few points based on the current cost containment environment in medical devices. Like everything else what goes up must come down. So the question must be asked, why does Globus need another $50 million? Could they be anticipating potential litigation settlements with other companies? Let’s face it, based on this company’s track record, anything is possible. Choir Boys they ain’t, but then again they’re not running a church or mission are they?
On the surface Globus has a pretty good war chest considering it generated $331.5 million in sales with profits north of $60 million. Globus brags that they hold the title as the fastest growing company in the industry, but I bet the Purple People Eaters would beg to differ. The concern that TSB has regarding Globus is whether they are perceived as an innovator, or are they really nothing more than an imitator on steroids? As NBA players love to say, “no question” Globus makes beautiful instruments and understands the value that visual appearances make when selling a system. Yet, TSB must ask our readers, what has the competition attempted to copy from Globus’ portfolio? How about informing John Q. Public, a potential investor, about the scope of these 5-10 projects that you intend on marketing over the next three years. Mystique Smishtique. There should be some transparency if you want the dow. Please, spare us the standard line that this information is proprietary. One has to wonder, what makes this company so unique outside of being managed well? Is there one product in their portfolio that is a game breaker? We would love to see the number of surgeon investors and consultants that have effected tremendous growth at Globus because without their exuberance Globus CAGR wouldn’t be anywhere near where it plays. Will they run, or will they stay after the IPO? Will everyone have reaped a windfall?
When Globus reaches their IPO milestone, how many shares of Common A will they be offering and at what price? TSB wants to know what our readers think?
As Henry Butler sings on the latest Jeff Golub album,
Hey tell everybody TSB’s back in town, I got a dollar and a quarter just rarin’ to clown
But don’t let nobody play me cheap, I got fifty cents more that I’m going to keep, so
Let the Good Times Roll, I don’t care if you’re young or old, Let the Good Times Roll!
