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Boston Scientific (BSX) New Buyouts Aid Amid COVID Resurgence
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Boston Scientific Corporation’s (BSX - Free Report) recent acquisitions have added various products with immense potential to its portfolio. However, unfavorable currency movement and product recalls have been major dampeners. The stock carries a Zacks Rank #3 (Hold).
Over the past year, Boston Scientific has outperformed the industry it belongs to. The stock has risen 19.5% against the industry’s 3.7% fall. The company’s third-quarter adjusted earnings surpassed the Zacks Consensus Estimate. Despite the temporary impact of the resurgence of COVID-19 on procedure volumes, the company reported year-over-year growth banking on new product launches, generated robust clinical evidence and executed broadly across the portfolio. Barring Cardiac Rhythm Management (CRM), organic revenues at each of its core business segments and geographies were up in the reported quarter. Specifically, the company delivered solid growth in the third quarter across Peripheral Interventions (PI), Electrophysiology and Endoscopy, fueled by new and ongoing product launches like TheraSphere, POLARx and AXIOS.
In the third quarter, Boston Scientific’s Interventional Cardiology organic sales grew 26%, driven by a 1,200 basis-point tailwind related to the WATCHMAN consignment sales return reserve taken in third-quarter 2020. The WATCHMAN franchise had another strong quarter of double-digit growth with a strong next-generation FLX performance and differentiated clinical data.
In TAVR, the ACURATE neo2 launch continued to do well in Europe supported by strong real-world clinical data, resulting in approximately 20% market share in open accounts. The momentum continues with SENTINEL, the company’s cerebral embolic protection device, which currently has more than 20% share in the United States.
New acquisitions like Preventice, Farapulse and Lumenis Surgical, which closed in March, August and September of 2021, respectively contributed to the inorganic growth of Boston Scientific in the reported quarter.
On the flip side, Boston Scientific third-quarter total revenues missed the Zacks Consensus Estimate. While the company registered a year-over-year improvement in sales, revenues dropped sequentially on the resurgence of COVID-19 across the United States. Core CRM third-quarter growth lagged the market. Further, elective procedures within the Pelvic Health portfolio were impacted by the emergence of the Delta variant during the third-quarter months. Reduced revenue guidance for 2021 posed concerns too.
Further escalating costs have been putting pressure on the bottom line. Although the company reported margin expansion on a year-over-year basis, the decline in R&D expenses is concerning.
Unfavorable currency movement and ongoing legal problems are other major dampeners Strong competitors in the large medical device market also pose a tough challenge for Boston Scientific.
Stocks to Consider
A few better-ranked stocks in the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , Varex Imaging Corporation (VREX - Free Report) and West Pharmaceutical Services, Inc. (WST - Free Report) .
AMN Healthcare, carrying a Zacks Rank #1 (Strong Buy), has a long-term earnings growth rate of 16.2%. The company surpassed earnings estimates in the trailing four quarters, delivering a surprise of 19.5%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcare has outperformed its industry over the past year. AMN has gained 60.2% versus the 58% industry decline.
Varex, carrying a Zacks Rank #1, has a long-term earnings growth rate of 5%. The company surpassed earnings estimates in the trailing four quarters, delivering an average surprise of 115.3%.
Varex has outperformed the industry it belongs to in the past year. VREX has gained 63.4% versus the industry’s 4% fall.
West Pharmaceutical, carrying a Zacks Rank #2 (Buy), has a long-term earnings growth rate of 27.6%. The company surpassed earnings estimates in the trailing four quarters, delivering an average surprise of 29.4%.
West Pharmaceutical has outperformed its industry over the past year. WST has rallied 60.1% compared with the industry’s 13.5% rise.
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Boston Scientific (BSX) New Buyouts Aid Amid COVID Resurgence
Boston Scientific Corporation’s (BSX - Free Report) recent acquisitions have added various products with immense potential to its portfolio. However, unfavorable currency movement and product recalls have been major dampeners. The stock carries a Zacks Rank #3 (Hold).
Over the past year, Boston Scientific has outperformed the industry it belongs to. The stock has risen 19.5% against the industry’s 3.7% fall. The company’s third-quarter adjusted earnings surpassed the Zacks Consensus Estimate. Despite the temporary impact of the resurgence of COVID-19 on procedure volumes, the company reported year-over-year growth banking on new product launches, generated robust clinical evidence and executed broadly across the portfolio. Barring Cardiac Rhythm Management (CRM), organic revenues at each of its core business segments and geographies were up in the reported quarter. Specifically, the company delivered solid growth in the third quarter across Peripheral Interventions (PI), Electrophysiology and Endoscopy, fueled by new and ongoing product launches like TheraSphere, POLARx and AXIOS.
In the third quarter, Boston Scientific’s Interventional Cardiology organic sales grew 26%, driven by a 1,200 basis-point tailwind related to the WATCHMAN consignment sales return reserve taken in third-quarter 2020. The WATCHMAN franchise had another strong quarter of double-digit growth with a strong next-generation FLX performance and differentiated clinical data.
Boston Scientific Corporation Price
Boston Scientific Corporation price | Boston Scientific Corporation Quote
In TAVR, the ACURATE neo2 launch continued to do well in Europe supported by strong real-world clinical data, resulting in approximately 20% market share in open accounts. The momentum continues with SENTINEL, the company’s cerebral embolic protection device, which currently has more than 20% share in the United States.
New acquisitions like Preventice, Farapulse and Lumenis Surgical, which closed in March, August and September of 2021, respectively contributed to the inorganic growth of Boston Scientific in the reported quarter.
On the flip side, Boston Scientific third-quarter total revenues missed the Zacks Consensus Estimate. While the company registered a year-over-year improvement in sales, revenues dropped sequentially on the resurgence of COVID-19 across the United States. Core CRM third-quarter growth lagged the market. Further, elective procedures within the Pelvic Health portfolio were impacted by the emergence of the Delta variant during the third-quarter months. Reduced revenue guidance for 2021 posed concerns too.
Further escalating costs have been putting pressure on the bottom line. Although the company reported margin expansion on a year-over-year basis, the decline in R&D expenses is concerning.
Unfavorable currency movement and ongoing legal problems are other major dampeners Strong competitors in the large medical device market also pose a tough challenge for Boston Scientific.
Stocks to Consider
A few better-ranked stocks in the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , Varex Imaging Corporation (VREX - Free Report) and West Pharmaceutical Services, Inc. (WST - Free Report) .
AMN Healthcare, carrying a Zacks Rank #1 (Strong Buy), has a long-term earnings growth rate of 16.2%. The company surpassed earnings estimates in the trailing four quarters, delivering a surprise of 19.5%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcare has outperformed its industry over the past year. AMN has gained 60.2% versus the 58% industry decline.
Varex, carrying a Zacks Rank #1, has a long-term earnings growth rate of 5%. The company surpassed earnings estimates in the trailing four quarters, delivering an average surprise of 115.3%.
Varex has outperformed the industry it belongs to in the past year. VREX has gained 63.4% versus the industry’s 4% fall.
West Pharmaceutical, carrying a Zacks Rank #2 (Buy), has a long-term earnings growth rate of 27.6%. The company surpassed earnings estimates in the trailing four quarters, delivering an average surprise of 29.4%.
West Pharmaceutical has outperformed its industry over the past year. WST has rallied 60.1% compared with the industry’s 13.5% rise.