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Here's Why You Should Buy Boston Scientific (BSX) Stock
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Boston Scientific Corporation (BSX - Free Report) is gaining from impressive growth in the MedSurg market share. New strategic investments to drive electrophysiology are boosting investors’ optimism. However, unfavorable currency movements and stiff competition are a concern.
In the past year, this Zacks Rank #2 (Buy) stock has gained 9.6% against a 38.3% plunge of the industry and a 7.4% decline of the S&P 500.
The renowned manufacturer of medical devices and products has a market capitalization of $74.18 billion. The company’s long-term projected growth of 11.2% compares with the industry’s growth projection of 14.6%.
Let’s delve deeper.
Factors At Play
MedSurg Market Share Gain Impressive: Following pandemic-led mayhem, Boston Scientific registered faster recovery within the MedSurg segment than the rest of its business arms.
Within urology and pelvic health, Boston Scientific continues to expand its market share globally. In the fourth quarter, sales increased 12% year over year organically. All franchises grew by double digits, fueled by new and ongoing product launches and continued global expansion.
In Endoscopy, sales rose 7% organically on the strong performance of the company’s products like AXIOS and Single-Use imaging. In the fourth quarter, Boston Scientific announced its plans to acquire Apollo Endosurgery, which is expected to add a complementary and innovative endoluminal surgery portfolio. Within Nuromodulation, organic growth was 5% in the reported quarter. Globally, the spinal cord stimulation business moved up 4% in the fourth quarter with consistent physician enthusiasm for WaveWriter Alpha and FAST.
New Strategic Investments to Drive Electrophysiology: We are looking forward to Boston Scientific’s acquisition of Farapulse, a leader in pulsed field ablation, an emerging field that can improve safety, efficacy and ease of use for cardiac ablation procedures. This acquisition complements Boston Scientific’s electrophysiology portfolio to include the FARAPULSE Pulsed Field Ablation (PFA) System. In its fourth-quarter earnings call, the company noted that the early Farapulse launch has been progressing in Europe, as physicians remain enthusiastic about the safety and ease of use of this technology.
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In this regard, the global Electrophysiology (EP) market is poised to reach a value of around $8.27 billion by 2022 (per data from Allied Market Research).
Upbeat Guidance: Boston Scientific provided its full-year and first-quarter 2023 guidance.
Full-year net sales growth is expected in the range of 5-7% on a reported basis. Net sales growth is expected in the range of 6-8% on an organic basis. Full-year adjusted earnings per share are expected in the range of $1.86-$1.93.
For the first quarter of 2023, revenue growth is projected in the range of approximately 3-5% on a reported basis (an increase of 6-8% organically). Adjusted earnings are expected in the range of 42-44 cents per share.
Downsides
Exposure to Currency Movement: With Boston Scientific recording 47% of its sales from the international market, it remains highly exposed to currency fluctuations. Unfavorable currency movements have been a major dampener over the last few quarters, as in the case of other important MedTech players too.
Competitive Landscape: The presence of a large number of players has made the medical devices market highly competitive. The company participates in several markets, including Cardiovascular, CRM, Endosurgery and Neuromodulation, where it faces competition from large, well-capitalized companies such as Johnson & Johnson, Abbott, Medtronic, Stryker, Smith & Nephew and Edwards Lifesciences, apart from several other smaller companies.
Estimate Trends
The Zacks Consensus Estimate for Boston Scientific’s 2023 earnings is pegged at $1.90 per share, indicating an 11.1% increase from the 2022 reported number.
The Zacks Consensus Estimate for 2023 revenues is pegged at $13.49 billion, suggesting a 6.4% rise from the 2022 figure.
Key Picks
Some other top-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , Becton, Dickinson and Company (BDX - Free Report) and Avanos Medical, Inc. (AVNS - Free Report) .
Hologic, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 15.2%. HOLX’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average beat being 30.6%.
Hologic has gained 1.7% against the industry’s 17.5% growth in the past year.
Becton, Dickinson and Company, carrying a Zacks Rank #2 at present, has an estimated long-term growth of 7.8%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.47%.
So far this year, BDX’s shares have lost 0.2% against the industry’s 8% growth.
Avanos, carrying a Zacks Rank #2 at present, has an estimated growth rate of 1.8% for 2023. AVNS’ earnings surpassed estimates in all the trailing four quarters, the average beat being 11%.
Avanos has lost 13.7% compared with the industry’s 17.5% decline in the past year.
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Here's Why You Should Buy Boston Scientific (BSX) Stock
Boston Scientific Corporation (BSX - Free Report) is gaining from impressive growth in the MedSurg market share. New strategic investments to drive electrophysiology are boosting investors’ optimism. However, unfavorable currency movements and stiff competition are a concern.
In the past year, this Zacks Rank #2 (Buy) stock has gained 9.6% against a 38.3% plunge of the industry and a 7.4% decline of the S&P 500.
The renowned manufacturer of medical devices and products has a market capitalization of $74.18 billion. The company’s long-term projected growth of 11.2% compares with the industry’s growth projection of 14.6%.
Let’s delve deeper.
Factors At Play
MedSurg Market Share Gain Impressive: Following pandemic-led mayhem, Boston Scientific registered faster recovery within the MedSurg segment than the rest of its business arms.
Within urology and pelvic health, Boston Scientific continues to expand its market share globally. In the fourth quarter, sales increased 12% year over year organically. All franchises grew by double digits, fueled by new and ongoing product launches and continued global expansion.
In Endoscopy, sales rose 7% organically on the strong performance of the company’s products like AXIOS and Single-Use imaging. In the fourth quarter, Boston Scientific announced its plans to acquire Apollo Endosurgery, which is expected to add a complementary and innovative endoluminal surgery portfolio.
Within Nuromodulation, organic growth was 5% in the reported quarter. Globally, the spinal cord stimulation business moved up 4% in the fourth quarter with consistent physician enthusiasm for WaveWriter Alpha and FAST.
New Strategic Investments to Drive Electrophysiology: We are looking forward to Boston Scientific’s acquisition of Farapulse, a leader in pulsed field ablation, an emerging field that can improve safety, efficacy and ease of use for cardiac ablation procedures. This acquisition complements Boston Scientific’s electrophysiology portfolio to include the FARAPULSE Pulsed Field Ablation (PFA) System. In its fourth-quarter earnings call, the company noted that the early Farapulse launch has been progressing in Europe, as physicians remain enthusiastic about the safety and ease of use of this technology.
In this regard, the global Electrophysiology (EP) market is poised to reach a value of around $8.27 billion by 2022 (per data from Allied Market Research).
Upbeat Guidance: Boston Scientific provided its full-year and first-quarter 2023 guidance.
Full-year net sales growth is expected in the range of 5-7% on a reported basis. Net sales growth is expected in the range of 6-8% on an organic basis. Full-year adjusted earnings per share are expected in the range of $1.86-$1.93.
For the first quarter of 2023, revenue growth is projected in the range of approximately 3-5% on a reported basis (an increase of 6-8% organically). Adjusted earnings are expected in the range of 42-44 cents per share.
Downsides
Exposure to Currency Movement: With Boston Scientific recording 47% of its sales from the international market, it remains highly exposed to currency fluctuations. Unfavorable currency movements have been a major dampener over the last few quarters, as in the case of other important MedTech players too.
Competitive Landscape: The presence of a large number of players has made the medical devices market highly competitive. The company participates in several markets, including Cardiovascular, CRM, Endosurgery and Neuromodulation, where it faces competition from large, well-capitalized companies such as Johnson & Johnson, Abbott, Medtronic, Stryker, Smith & Nephew and Edwards Lifesciences, apart from several other smaller companies.
Estimate Trends
The Zacks Consensus Estimate for Boston Scientific’s 2023 earnings is pegged at $1.90 per share, indicating an 11.1% increase from the 2022 reported number.
The Zacks Consensus Estimate for 2023 revenues is pegged at $13.49 billion, suggesting a 6.4% rise from the 2022 figure.
Key Picks
Some other top-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , Becton, Dickinson and Company (BDX - Free Report) and Avanos Medical, Inc. (AVNS - Free Report) .
Hologic, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 15.2%. HOLX’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average beat being 30.6%.
You can see the complete list of today’s Zacks #1(Strong Buy) Rank stocks here.
Hologic has gained 1.7% against the industry’s 17.5% growth in the past year.
Becton, Dickinson and Company, carrying a Zacks Rank #2 at present, has an estimated long-term growth of 7.8%. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.47%.
So far this year, BDX’s shares have lost 0.2% against the industry’s 8% growth.
Avanos, carrying a Zacks Rank #2 at present, has an estimated growth rate of 1.8% for 2023. AVNS’ earnings surpassed estimates in all the trailing four quarters, the average beat being 11%.
Avanos has lost 13.7% compared with the industry’s 17.5% decline in the past year.