IRVINE, Calif. – Masimo (NASDAQ:) Corporation (NASDAQ: MASI) is currently in a public dispute with Politan over the latter’s board nominations and the qualifications of Masimo’s own nominees. Masimo contends that Politan’s campaign contains misleading information and urges shareholders to vote for its nominees, Joe Kiani and Christopher Chavez, using the gold card.
Masimo alleges that Politan’s nominees, presented as independent and found through a third-party search firm, are not as independent as claimed. The company points out that one nominee, Mr. Jellison, was appointed to the board of Anika Therapeutics (NASDAQ:) through an activist with ties to Politan and has a history of questionable financial investments.
Moreover, Masimo argues that Dr. Solomon’s expertise in Chemistry is not relevant to the company’s needs and that both Politan nominees are being compensated for their candidacy.
The company also refutes Politan’s assertions regarding a lack of board oversight in a transaction pursued by Mr. Kiani, stating that the full board is overseeing the process, and that the intellectual property framework proposed to a potential joint venture partner is consistent with what was previously proposed by Mr. Koffey of Politan.
Furthermore, Masimo addresses Politan’s criticisms of Mr. Kiani’s corporate jet use, stating that the travel is predominantly for business and that personal use is paid for by Mr. Kiani. The company also defends Mr. Kiani’s leadership, citing certifications and awards based on employee surveys, and challenges Politan’s claims regarding the timeliness of notifications about DOJ and SEC subpoenas.
Masimo also clarifies that the Masimo Foundation’s investment in a company associated with Mr. Chavez does not benefit him personally, and that he was previously unaware of the investment.
This press release statement from Masimo Corporation is a response to the ongoing dispute with Politan, which has nominated its own candidates for Masimo’s board. The company emphasizes its commitment to transparency and shareholder value and seeks to correct what it views as Politan’s misleading campaign.
In other recent news, Masimo Corp reported robust Q1 2024 earnings, with healthcare revenues reaching $340 million, indicating a market share expansion. The company also successfully relocated sensor production to Malaysia, enhancing gross margins.
Following these positive results, Masimo has raised its guidance for healthcare revenues and non-GAAP EPS. Moreover, Masimo’s Chief Operating Officer, Bilal Muhsin, has submitted a conditional resignation, contingent upon the removal of Joe Kiani as Chairman of the Board and CEO.
The company is also opposing a takeover bid by Politan, urging shareholders to vote for the reelection of its founder, Joe Kiani, and director nominee Christopher Chavez. Piper Sandler recently upgraded the company’s stock from Neutral to Overweight, citing improvements in Masimo’s core healthcare business.
Furthermore, Masimo is currently evaluating strategic options for its consumer business, including a potential spin-off or sale. These are among the recent developments within Masimo Corp.
InvestingPro Insights
As Masimo Corporation (NASDAQ: MASI) navigates through the choppy waters of a public dispute with Politan, the financial metrics and analyst expectations surrounding the company are of particular interest to investors. With the battle for board control as a backdrop, here are some key insights based on data from InvestingPro.
InvestingPro Data shows a market capitalization of $6.18 billion for Masimo, which is substantial, yet investors should note the high P/E ratio of 77.77. This indicates a significant expectation of earnings growth, aligning with an InvestingPro Tip that net income is expected to grow this year. Still, this optimism is tempered by the fact that six analysts have revised their earnings downwards for the upcoming period, suggesting that there may be challenges ahead.
In terms of financial health, another InvestingPro Tip highlights that Masimo’s liquid assets exceed its short-term obligations, which is a positive sign of the company’s ability to meet its immediate financial liabilities. Moreover, the company operates with a moderate level of debt, which may provide some flexibility in strategic decision-making during this dispute.
Investors considering the impact of these board nominations on the company’s value may also take into account Masimo’s recent stock performance. The company has seen its stock take a substantial hit over the last week, with a price total return of -12.1%. This short-term volatility could reflect market reactions to the ongoing boardroom tussle and the uncertainty it brings.
For those looking to delve deeper into Masimo’s financials and strategic outlook, InvestingPro offers additional insights and tips. Currently, there are 11 more InvestingPro Tips available for Masimo, which could provide further clarity for shareholders and potential investors during this contentious time. To access these valuable insights, use coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription at https://www.investing.com/pro/MASI.
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