Shares of San Diego-based NuVasive Inc. (Nasdaq: NUVA) jumped Wednesday after the spinal device maker reported stronger-than-expected revenue for the fourth quarter and forecast strong revenue growth in 2013.
The company said it expects to report about $619 million in revenue in 2012, well above its previous estimates. The forecast suggests NuVasive's revenue totaled $164 million to $165 million in the fourth quarter.
According to FactSet, analysts were estimating $150.6 million in revenue in the fourth quarter.
The company said its revenue should total about $655 million in 2013, up about 6 percent from 2012. NuVasive said it believes its revenue growth will accelerate over the course of 2013 as it launches new products and expands into new regions.
Analysts expected the company to post $638.2 million in revenue in 2013.
In October NuVasive cut its 2012 revenue estimate by about $7 million, saying sales were hurt by increased discounts from competitors, coverage delays and denials from health insurers, and by increased customer turnover as more surgeons participated in physician-owned distributorships. The company said it was responding by speeding up the pace of new hires for its sales force, and it is increasing its engagement with major customers.
RBC Capital Markets analyst Glenn Novarro upgraded NuVasive shares to "sector perform" from "underperform," saying the company appears to have addressed its sales force problems and is working to reduce customer turnover.
Novarro raised his price target to $18 per share from $16 and said he believes NuVasive stock should continue to trade around that price.
Shares of NuVasive advanced $1.96, or 12.4 percent, to $17.72 in afternoon trading. The stock has traded between $11.28 and $25.99 over the last year. Since the company cut its guidance on Oct. 3, the shares had lost 30 percent of their value.