Dallas Salazar
IPOs, contrarian, long/short equity, long-term horizon

The Market Finally Values K2M Group Holdings

THE MARKET FINALLY VALUES K2M GROUP HOLDINGS

First Defending, Now Pounding the Table

SUMMARY VIEW: After 7 months of defending K2M Group Holdings, Inc. (NASDAQ:KTWO), and being down ~10% shortly after Q2/14 earnings, shares have rallied and are now trading at 52 week highs. Shares have since returned 56% from the lows of late-September and have returned 41% trade inception to date. KTWO continues to show ~20% top-line growth, should begin to see margin expansion during Q4/14 & Q1/15, and is well positioned to accelerate growth into the near term. KTWO also has the balance sheet flexibility and the liquidity to meet the demands of its currently high cash burn, high CAPEX model. I continue to recommend a...

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