There's Uncertainty Around Apple's Patent Appeal For Watch, Masimo's Royalty Exposure Is Priced In - Analyst Downgrades
Portfolio Pulse from Vandana Singh
Needham downgraded Masimo Corporation (MASI) from Buy to Hold, with no new price target, previously $86, due to uncertainties around Apple Inc's (AAPL) patent appeal and potential royalty payments for Apple Watch. A U.S. appeals court temporarily halted an import ban on certain Apple smartwatches amid the patent dispute with Masimo. Apple has also filed a lawsuit against Masimo in Delaware. The downgrade reflects the view that potential royalties from AAPL are mostly priced into MASI shares, and concerns over MASI's earnings potential and mixed feedback on its new consumer health products. MASI shares dropped 2.39% to $111.88.
January 03, 2024 | 6:30 pm
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Needham downgraded Masimo Corporation to Hold due to uncertainties around Apple's patent appeal and the potential impact on royalty payments, as well as concerns over earnings potential and new product reception.
The downgrade by Needham suggests a neutral to negative outlook on MASI's stock in the short term, as the potential royalty payments from AAPL are considered priced in and there are additional concerns about MASI's earnings and new product feedback.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90
NEUTRAL IMPACT
Apple Inc is involved in a patent dispute with Masimo Corporation, which has led to a temporary halt on an import ban of certain Apple smartwatches and a separate lawsuit filed by Apple against Masimo in Delaware.
While the patent dispute and legal proceedings create uncertainty, the direct short-term impact on AAPL's stock price is less clear, as the company has a diverse product portfolio and the outcome of the dispute is still uncertain.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 70