Masimo Corporation (MASI) saw its stock plummet 11.09% in pre-market trading on Wednesday, following a series of target price cuts by several analysts. The sharp decline comes in the wake of Masimo's announcement that it would sell its audio business to Samsung Electronics' Harman International for $350 million.
Multiple financial institutions adjusted their outlook on Masimo stock: - Jefferies lowered its target price to $158 from $175 - Wells Fargo reduced its target to $190 from $205 - BTIG cut its target to $193 from $206 - Raymond James decreased its target to $185 from $204 - Stifel lowered its target to $180 from $190
The widespread downward revisions suggest that analysts are reassessing Masimo's value following the audio business divestiture. While the $350 million sale to Harman International may provide Masimo with additional capital, investors appear concerned about the company's future growth prospects and overall strategic direction. The market's negative reaction indicates that shareholders may view the sale as unfavorable for Masimo's long-term outlook, leading to the significant pre-market sell-off.