We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Here's Why You Should Hold on to Stryker (SYK) Stock for Now
Read MoreHide Full Article
Stryker Corporation (SYK - Free Report) is well-poised for growth backed by a robust robotic-arm assisted surgery platform, Mako, and a diversified product portfolio. However, pricing pressure remains a headwind.
Shares of the Zacks Rank #3 (Hold) company have gained 13.1% against the industry’s decline of 12.6% in a year’s time. The S&P 500 Index has risen 13.4% in the same time frame.
Stryker, with a market capitalization of $100.84 billion, is one of the world’s largest medical device companies operating in the orthopedic market. It anticipates earnings to improve by 9.2% in the next five years. Stryker’s earnings yield is 3.7% comparing favorably with the industry’s (0.4%).
What’s Favoring Growth?
Mako is Stryker’s robotic-arm assisted surgery platform. The company continues to witness strong demand for Mako and a healthy order book, courtesy of the platform’s unique features despite financial constraints stemming from the COVID-19 pandemic. This, in turn, positions it well to sustain momentum in robot sales and recon share market gains.
The company is committed to the continued expansion of Mako. In 2021, the company’s Mako install base saw growth of 27%, and currently has an installed base that is moving toward 1500 Mako robots. Thus, the company continues to focus on continued expansion of Mako. This growth reflects demand for Stryker’s differentiated Mako robotic technology.
For 2022, the company’s Mako order book remains solid, and is in sync with its aim of sustained share gain in both hips and knees.
Image Source: Zacks Investment Research
Additionally, Stryker has a diversified product portfolio. Its wide range of products shields the company against any significant sales shortfall during economic turmoil. Its significant exposure in robotics, Artificial Intelligence for health care and Medical Mechatronics has helped the company stay ahead of the curve in the MedTech space. Stryker’s portfolio includes products like Hip, Knee and Mako robotic-arm assisted surgeries.
In September, 2021, the company’s Trauma & Extremities division introduced a Citrelock Tendon Fixation Device System, which offers surgeons a differentiated design through a tendon thread featuring Citregen — a resorbable technology. Citregen, in particular, has chemical and mechanical qualities intended for orthopedic surgical applications.
Per management, the company’s sustained support for customers and focus on innovation poise it for growth, as the pandemic eventually subsides. In the fourth quarter of 2021, Stryker’s adjusted R&D expenses were 6.4% of net sales, which highlights its sustained commitment to innovation. Per management, this is likely to drive new product launches.
What’s Hurting the Stock?
An unfavorable pricing environment poses a persistent threat to Stryker’s core businesses. It is important to note here that 2021 had the same number of selling days as 2019 and one less selling day compared to 2020. In comparison to 2019, the two-year impact from pricing in the fourth quarter was 1.7% on the company’s top line (0.8% compared with fourth-quarter 2020). Consequently, pricing pressure remains a cause of concern.
Estimates Trend
The Zacks Consensus Estimate for 2022 earnings per share is pegged at $9.75, suggesting growth of 7.3% from 2021. The consensus mark for 2022 revenues stands at $18.25 billion, indicating an improvement of 6.7% from the previous year.
Stocks to Consider
Some better-ranked stocks in the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , Henry Schein, Inc. (HSIC - Free Report) and McKesson Corporation (MCK - Free Report) .
AMN Healthcare surpassed earnings estimates in each of the trailing four quarters, the average surprise being 20%. The company currently sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcare’s long-term earnings growth rate is estimated at 16.2%. The company’s earnings yield of 8.8% compares favorably with the industry’s 0.3%.
Henry Schein beat earnings estimates in each of the trailing four quarters, the average surprise being 25.5%. The company currently carries a Zacks Rank #1.
Henry Schein’s long-term earnings growth rate is estimated at 11.8%. The company’s earnings yield of 5.6% compares favorably with the industry’s 4.1%.
McKesson surpassed earnings estimates in each of the trailing four quarters, the average surprise being 20.6%. The company currently carries a Zacks Rank #2 (Buy).
McKesson’s long-term earnings growth rate is estimated at 11.8%. The company’s earnings yield of 8.8% compares favorably with the industry’s 4.1%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Here's Why You Should Hold on to Stryker (SYK) Stock for Now
Stryker Corporation (SYK - Free Report) is well-poised for growth backed by a robust robotic-arm assisted surgery platform, Mako, and a diversified product portfolio. However, pricing pressure remains a headwind.
Shares of the Zacks Rank #3 (Hold) company have gained 13.1% against the industry’s decline of 12.6% in a year’s time. The S&P 500 Index has risen 13.4% in the same time frame.
Stryker, with a market capitalization of $100.84 billion, is one of the world’s largest medical device companies operating in the orthopedic market. It anticipates earnings to improve by 9.2% in the next five years. Stryker’s earnings yield is 3.7% comparing favorably with the industry’s (0.4%).
What’s Favoring Growth?
Mako is Stryker’s robotic-arm assisted surgery platform. The company continues to witness strong demand for Mako and a healthy order book, courtesy of the platform’s unique features despite financial constraints stemming from the COVID-19 pandemic. This, in turn, positions it well to sustain momentum in robot sales and recon share market gains.
The company is committed to the continued expansion of Mako. In 2021, the company’s Mako install base saw growth of 27%, and currently has an installed base that is moving toward 1500 Mako robots. Thus, the company continues to focus on continued expansion of Mako. This growth reflects demand for Stryker’s differentiated Mako robotic technology.
For 2022, the company’s Mako order book remains solid, and is in sync with its aim of sustained share gain in both hips and knees.
Image Source: Zacks Investment Research
Additionally, Stryker has a diversified product portfolio. Its wide range of products shields the company against any significant sales shortfall during economic turmoil. Its significant exposure in robotics, Artificial Intelligence for health care and Medical Mechatronics has helped the company stay ahead of the curve in the MedTech space. Stryker’s portfolio includes products like Hip, Knee and Mako robotic-arm assisted surgeries.
In September, 2021, the company’s Trauma & Extremities division introduced a Citrelock Tendon Fixation Device System, which offers surgeons a differentiated design through a tendon thread featuring Citregen — a resorbable technology. Citregen, in particular, has chemical and mechanical qualities intended for orthopedic surgical applications.
Per management, the company’s sustained support for customers and focus on innovation poise it for growth, as the pandemic eventually subsides. In the fourth quarter of 2021, Stryker’s adjusted R&D expenses were 6.4% of net sales, which highlights its sustained commitment to innovation. Per management, this is likely to drive new product launches.
What’s Hurting the Stock?
An unfavorable pricing environment poses a persistent threat to Stryker’s core businesses. It is important to note here that 2021 had the same number of selling days as 2019 and one less selling day compared to 2020. In comparison to 2019, the two-year impact from pricing in the fourth quarter was 1.7% on the company’s top line (0.8% compared with fourth-quarter 2020). Consequently, pricing pressure remains a cause of concern.
Estimates Trend
The Zacks Consensus Estimate for 2022 earnings per share is pegged at $9.75, suggesting growth of 7.3% from 2021. The consensus mark for 2022 revenues stands at $18.25 billion, indicating an improvement of 6.7% from the previous year.
Stocks to Consider
Some better-ranked stocks in the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , Henry Schein, Inc. (HSIC - Free Report) and McKesson Corporation (MCK - Free Report) .
AMN Healthcare surpassed earnings estimates in each of the trailing four quarters, the average surprise being 20%. The company currently sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcare’s long-term earnings growth rate is estimated at 16.2%. The company’s earnings yield of 8.8% compares favorably with the industry’s 0.3%.
Henry Schein beat earnings estimates in each of the trailing four quarters, the average surprise being 25.5%. The company currently carries a Zacks Rank #1.
Henry Schein’s long-term earnings growth rate is estimated at 11.8%. The company’s earnings yield of 5.6% compares favorably with the industry’s 4.1%.
McKesson surpassed earnings estimates in each of the trailing four quarters, the average surprise being 20.6%. The company currently carries a Zacks Rank #2 (Buy).
McKesson’s long-term earnings growth rate is estimated at 11.8%. The company’s earnings yield of 8.8% compares favorably with the industry’s 4.1%.