US Mkt Stable, OUS in Guide; Focused on Profit, FCF, and Execution; Buy, $40 PT

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US Mkt Stable, OUS in Guide; Focused on Profit, FCF, and Execution; Buy, $40 PT

Enovis Corp (ENOV)

Equity Research

July 13, 2026

ASC Share Above Market Driven By Differentiated Products

ENOV has the newest Knee implant (Empowr) and streamlined instrumentation with less trays, easier

contracting that bypasses the bigger hosps and GPOs contracting process. ENOV believes their ASC

business is above the industry penetration rates driven by their more modernized portfolio, product

differentiation, and contracting. ~25% of ENOV primary US Knees goes into ASCs. Ultimately ASCs

penetration can be as high as 50-60%.

The initial large joint ASC adoption had gone quickly from 0 to 10%. Then COVID hit and slowed that

trend as extra demand was met in hospitals. Growth should continue given favorable economics for

some surgeon owners, as well as the pace of hospital capex to build out ASCs. Some ASCs participate

in GPOs, and some are affiliated with hospitals, while some are independent. ASC pricing is a bit lower

than the hospital setting, but it also has a lower cost to serve with simpler instruments. There’s also

lots of discussions in OUS markets for ASCs.

We believe ENOV is positioned to win in ASCs because of its focus. The Empowr 3D Knee is better

suited for ASCs given it’s better for more active patients, feels more natural and responsive to patients,

and also has simpler and smaller instrument trays. ENOV’s OaraScore outpatient arthroplasty risk

assessment score is a predictive risk assessment tool for ASC and outpatient patients’ selection.

In Shoulders, it is ~15% ASCs but the market data is tough to come by given very limited disclosures.

ARVIS is also geared towards ASCs given its small footprint, workflow enhancement, and low cost.