BOSTON—MVM Partners, LLC, a significant shareholder in Paragon 28, Inc. (NYSE:FNA), has reported selling a substantial portion of its holdings in the company. According to a recent filing with the Securities and Exchange Commission, MVM Partners sold a total of 254,947 shares over two days, translating to a total transaction value of approximately $2.63 million.
The sales occurred on November 20 and November 21, with the shares sold at prices ranging from $10.28 to $10.41 each. Following these transactions, MVM Partners retains ownership of 10,631,198 shares in Paragon 28. The firm manages its holdings through various entities, including MVM V (2020) LP, MVM V LP, and MVM GP (No. 5) LP, as noted in the filing.
These transactions reflect MVM Partners' ongoing management of its investment in Paragon 28, a company specializing in surgical and medical instruments.
In other recent news, Paragon 28, a key player in the foot and ankle orthopedic market, reported significant growth in its Q3 2024 earnings call. The company announced a record global revenue of $62.3 million, marking an 18.1% increase from the prior year. Revenues from the U.S. market rose to $51.2 million, up 14.8%, while international markets experienced a notable 35.7% growth.
Paragon 28's operational improvements were clear as they reported a decrease in free cash flow usage and a first-time positive adjusted EBITDA since its IPO. The company also launched 13 new products, including the Phantom Fibula Nail System and a short stem tibia implant, contributing to its robust performance.
In light of these developments, Paragon 28 has raised its full-year net revenue guidance for 2024 to between $252 million and $256 million. The company aims to achieve EBITDA positivity in 2025 and cash flow positivity in 2026. Despite inventory levels being higher than industry standards, the company is focused on reductions. With its total ankle franchise and new product offerings such as the SMART 28 module, Paragon 28 anticipates continued growth.
InvestingPro Insights
The recent share sale by MVM Partners comes at a time when Paragon 28 (NYSE:FNA) is experiencing significant market momentum. According to InvestingPro data, the company has seen a remarkable 92.79% price return over the past month, indicating strong investor interest. This surge aligns with the company's solid revenue growth of 18.16% over the last twelve months, suggesting improved business performance.
However, investors should note that despite the recent price rally, Paragon 28 faces profitability challenges. An InvestingPro Tip highlights that analysts do not anticipate the company to be profitable this year. This is further supported by the negative operating income of -$39.98 million for the last twelve months.
Another InvestingPro Tip points out that the company is trading at a high Price / Book multiple, which stands at 6.04. This valuation metric, combined with the company's current profitability status, may be factors for investors to consider when assessing the stock's potential.
For a more comprehensive analysis, InvestingPro offers 7 additional tips for Paragon 28, providing deeper insights into the company's financial health and market position.
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