TD Cowen Stands By Alphatec (ATEC) With Buy Rating, Sees $20 Target Amid Coverage Shift
In a move highlighting continued conviction amidst a coverage transition, investment firm TD Cowen has reaffirmed its Buy rating on Alphatec Holdings (NASDAQ: ATEC), the spine technology specialist, while adjusting its price target to $20 from $27. The firm contends the market is underestimating the company's strategic growth vectors, creating a potential opportunity for investors.
The revised target, issued on January 27, follows the handover of coverage to a new analyst within the firm. TD Cowen's research note suggested that prevailing expectations fail to fully price in Alphatec's ambitious $890 million revenue outlook for 2026 and the recent, exclusive U.S. rights acquisition for Theradaptive's OsteoAdapt—a protein-engineered bone graft designed to stimulate natural bone growth in spinal fusion procedures.
"This isn't just a routine target adjustment; it's a signal of sustained belief in the fundamentals," said market strategist Eleanor Vance. "When coverage transfers, it's common to see models recalibrated. The maintained 'Buy' is the key takeaway, suggesting the core investment thesis around their pure-play spine strategy remains intact."
The OsteoAdapt deal, announced January 12 alongside Theradaptive's Series B funding round, is positioned as a cornerstone of that strategy. The partnership grants Alphatec exclusive U.S. commercialization rights, structured with upfront and milestone payments plus royalties, aiming to disrupt the expansive $10 billion domestic spine biologics market.
"Alphatec is aggressively building a comprehensive ecosystem for spine surgery," noted healthcare sector analyst Marcus Reed. "Securing exclusive rights to a differentiated biologic like OsteoAdapt complements their implant portfolio and could be a significant long-term margin driver."
However, not all observers share the unbridled optimism. "A price target cut of over 25% is hard to spin as purely positive," argued retail investor and frequent financial commentator David Choi, whose tone was notably sharper. "It raises questions about prior assumptions. While the 'Buy' rating is held, the lowered target implicitly acknowledges near-term hurdles or a more conservative view on valuation. Investors should scrutinize execution risks closely."
Alphatec Holdings, which designs and markets solutions for spinal disorder treatment globally, has often been noted for its high short interest, a factor that can amplify volatility but also indicate a divergence between market sentiment and fundamental belief.
TD Cowen's stance implies that as Alphatec executes on its integrated technology and biologics strategy, financial estimates may see upward revisions, potentially catalyzing a re-rating by the broader market.