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Three Reasons to Add Masimo (MASI) Stock to Your Portfolio
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Masimo Corporation (MASI - Free Report) has been gaining from its solid product suite. The optimism led by a solid first-quarter 2023 performance and its slew of regulatory approvals are expected to contribute further. However, concerns regarding overdependence on Masimo SET and stiff competition persist.
Over the past year, this Zacks Rank #2 (Buy) stock has gained 18.7% compared with the industry’s 10.8% rise and the S&P 500's 13.3% growth.
The renowned global provider of non-invasive monitoring systems has a market capitalization of $8.59 billion. The company projects 3.7% growth for 2023 and expects to maintain its strong performance. Masimo has delivered an earnings surprise of 9.9% for the past four quarters, on average.
Image Source: Zacks Investment Research
Let’s delve deeper.
Product Suite: We are upbeat about Masimo’s product pipeline. This month, the company announced that it is expanding its premium Denon brand to introduce its latest offering, Masimo AAT (Adaptive Acoustic Technology). The products offered are Denon PerL and PerL Pro True Wireless Earbuds featuring Masimo AAT.
In May, it announced the global expansion of the HEOS platform, an iconic brand within its non-healthcare premium and luxury consumer audio business. The expansion enables an always-on connection to the Masimo Health secure cloud for 4 million devices.
Regulatory Approvals: Masimo has been receiving regulatory approvals for its products over the past few months, raising our optimism. This month, the company announced that its patient-worn, continuous multi-parameter vital signs monitor, Radius VSM, had received the FDA’s 510(k) clearance.
In April, Masimo announced the receipt of the FDA’s 510(k) clearance for its Rad-G with Temperature.
Strong Q1 Results: Masimo’s solid first-quarter 2023 results buoy our optimism. The company recorded a robust uptick in the top line, its healthcare business and order shipments in the reported period. The expansion of the company’s installed base was also seen. On the first-quarter earnings call in May, Masimo’s management confirmed having new customers in its pulse oximetry business, and witnessed increasing traction for rainbow and advanced parameter products, which strengthened the healthcare revenues in the quarter.
Downsides
Overdependence on Masimo SET: Masimo currently derives the majority of its revenues from its primary product offerings like the Masimo SET platform, Masimo rainbow SET platform and related products. Thus, the company’s business is highly dependent on the continued success and market acceptance of its primary product offerings.
Stiff Competition: Masimo operates in an intensely competitive medical device industry and is significantly affected by new product introductions and other market activities of industry participants. The Masimo SET platform faces additional competition from companies developing products for use with third-party monitoring systems and from companies currently marketing their pulse oximetry monitors.
Estimate Trend
Masimo has been witnessing a positive estimate revision trend for 2023. In the past 90 days, the Zacks Consensus Estimate for its earnings per share has moved north by a penny to $4.76.
The Zacks Consensus Estimate for the company’s second-quarter 2023 revenues is pegged at $550.9 million, suggesting a 2.6% decline from the year-ago quarter’s reported number.
Other Key Picks
A few other top-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , HealthEquity, Inc. (HQY - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Hologic, carrying a Zacks Rank #2 at present, has an estimated growth rate of 5.1% for fiscal 2024. HOLX’s earnings surpassed estimates in all the trailing four quarters, the average being 27.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hologic has gained 16.2% compared with the industry’s 10.8% rise in the past year.
HealthEquity, sporting a Zacks Rank #1 at present, has an estimated long-term growth rate of 22%. HQY’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 9.1%.
HealthEquity has lost 8.4% compared with the industry’s 22.2% decline over the past year.
Boston Scientific, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 11.5%. BSX’s earnings surpassed estimates in two of the trailing four quarters and missed in the other two, the average surprise being 1.9%.
Boston Scientific has gained 42.7% against the industry’s 22.6% decline over the past year.
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Three Reasons to Add Masimo (MASI) Stock to Your Portfolio
Masimo Corporation (MASI - Free Report) has been gaining from its solid product suite. The optimism led by a solid first-quarter 2023 performance and its slew of regulatory approvals are expected to contribute further. However, concerns regarding overdependence on Masimo SET and stiff competition persist.
Over the past year, this Zacks Rank #2 (Buy) stock has gained 18.7% compared with the industry’s 10.8% rise and the S&P 500's 13.3% growth.
The renowned global provider of non-invasive monitoring systems has a market capitalization of $8.59 billion. The company projects 3.7% growth for 2023 and expects to maintain its strong performance. Masimo has delivered an earnings surprise of 9.9% for the past four quarters, on average.
Image Source: Zacks Investment Research
Let’s delve deeper.
Product Suite: We are upbeat about Masimo’s product pipeline. This month, the company announced that it is expanding its premium Denon brand to introduce its latest offering, Masimo AAT (Adaptive Acoustic Technology). The products offered are Denon PerL and PerL Pro True Wireless Earbuds featuring Masimo AAT.
In May, it announced the global expansion of the HEOS platform, an iconic brand within its non-healthcare premium and luxury consumer audio business. The expansion enables an always-on connection to the Masimo Health secure cloud for 4 million devices.
Regulatory Approvals: Masimo has been receiving regulatory approvals for its products over the past few months, raising our optimism. This month, the company announced that its patient-worn, continuous multi-parameter vital signs monitor, Radius VSM, had received the FDA’s 510(k) clearance.
In April, Masimo announced the receipt of the FDA’s 510(k) clearance for its Rad-G with Temperature.
Strong Q1 Results: Masimo’s solid first-quarter 2023 results buoy our optimism. The company recorded a robust uptick in the top line, its healthcare business and order shipments in the reported period. The expansion of the company’s installed base was also seen. On the first-quarter earnings call in May, Masimo’s management confirmed having new customers in its pulse oximetry business, and witnessed increasing traction for rainbow and advanced parameter products, which strengthened the healthcare revenues in the quarter.
Downsides
Overdependence on Masimo SET: Masimo currently derives the majority of its revenues from its primary product offerings like the Masimo SET platform, Masimo rainbow SET platform and related products. Thus, the company’s business is highly dependent on the continued success and market acceptance of its primary product offerings.
Stiff Competition: Masimo operates in an intensely competitive medical device industry and is significantly affected by new product introductions and other market activities of industry participants. The Masimo SET platform faces additional competition from companies developing products for use with third-party monitoring systems and from companies currently marketing their pulse oximetry monitors.
Estimate Trend
Masimo has been witnessing a positive estimate revision trend for 2023. In the past 90 days, the Zacks Consensus Estimate for its earnings per share has moved north by a penny to $4.76.
The Zacks Consensus Estimate for the company’s second-quarter 2023 revenues is pegged at $550.9 million, suggesting a 2.6% decline from the year-ago quarter’s reported number.
Other Key Picks
A few other top-ranked stocks in the broader medical space are Hologic, Inc. (HOLX - Free Report) , HealthEquity, Inc. (HQY - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Hologic, carrying a Zacks Rank #2 at present, has an estimated growth rate of 5.1% for fiscal 2024. HOLX’s earnings surpassed estimates in all the trailing four quarters, the average being 27.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hologic has gained 16.2% compared with the industry’s 10.8% rise in the past year.
HealthEquity, sporting a Zacks Rank #1 at present, has an estimated long-term growth rate of 22%. HQY’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 9.1%.
HealthEquity has lost 8.4% compared with the industry’s 22.2% decline over the past year.
Boston Scientific, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 11.5%. BSX’s earnings surpassed estimates in two of the trailing four quarters and missed in the other two, the average surprise being 1.9%.
Boston Scientific has gained 42.7% against the industry’s 22.6% decline over the past year.