We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
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 GEHC Stock in Your Portfolio for Now
Read MoreHide Full Article
GE HealthCare Technologies, Inc. (GEHC - Free Report) is well-poised for growth in the coming quarters, courtesy of its continued focus on innovations. The optimism, led by strong fourth-quarter 2024 performance and acquisitions, is expected to contribute further. However, geopolitical tensions and stiff competition are concerning.
This Zacks Rank #3 (Hold) company’s shares have lost 11.6% in the past six months against the 1.2% growth of the industry. The S&P 500 composite has lost 0.9% during the said time frame.
The renowned provider of medical technology, pharmaceutical diagnostics and digital solutions has a market capitalization of $37.27 billion. The company projects 6.2% growth for the next five years and expects to maintain its strong performance going forward. It delivered a trailing four-quarter average earnings surprise of 6.17%.
Image Source: Zacks Investment Research
Factors Favoring GEHC’s Growth
Macro Tailwinds Boost Performance: GE HealthCare’s strong growth across all its segments and regions is primarily being driven by macro tailwinds, including the easing of supply-chain challenges. This trend is likely to continue in 2025. Moreover, robust demand and improved pricing of its products look promising. Key products driving revenue growth are Magnetic Resonance (“MR”), MI, CT, general imaging and women's health products. The company expects organic revenue growth of 2-3% in 2025. It had an order backlog worth $19.8 billion at the end of December 2024.
Innovations Supporting Growth: GE HealthCare’s commitment to drive innovation has allowed it to achieve continuous, significant improvements. Recently the company announced the launch of Invenia Automated Breast Ultrasound Premium, the latest 3D ultrasound offering advanced artificial intelligence (AI) and innovative features to drive faster, reproducible supplemental screening and streamline exam readings on patients with dense breasts.
Earlier this month, GEHC announced the launch of the AltiX AI.i edition of Mac-Lab, CardioLab and ComboLab. The AltiX AI.i edition is expected to enhance efficiency and precision care for multiple types of cardiac procedures. The latest launch is expected to significantly strengthen GE HealthCare’s CardioVascular & Interventional Solutions unit, thus boosting its Advanced Visualization Solutions business.
Also, GEHC unveiled the Genesis portfolio, a portfolio of cloud enterprise imaging software-as-a-service solutions designed to modernize healthcare data management. Genesis is likely to offer scalable, secure and interoperable solutions that help hospitals and health systems streamline workflows, enhance patient data access and reduce operational costs.
Last month, GEHC unveiled Freelium, a next-generation sealed magnet platform at ECR 2025, designed to revolutionize MR imaging. The platform uses less than 1% of helium compared with traditional systems, promoting sustainability and expanding access to quality imaging in helium-scarce regions.
In January, it announced receiving FDA 510(k) clearance for updated Voluson Expert Series ultrasound systems. This advanced portfolio, which includes the Voluson Expert 22, 20 and 18, sets a new benchmark in women’s healthcare by combining exceptional image quality, cutting-edge ultrasound technology and ergonomic design to enhance workflow efficiency and deliver an unparalleled user experience.
Acquisitions & Partnerships: GE HealthCare has several partnership agreements that help attract long-term customers for its products and services. GEHC is also focused on acquiring companies that will help it grow.
Recently, GEHC announced an expansion of its collaboration with NVIDIA Corporation to advance AI-driven autonomous solutions, which were designed to ease the growing burden on healthcare professionals.GE HealthCare aims to develop AI-enabled X-ray and ultrasound systems by leveraging the new NVIDIA Isaac for Healthcare platform, built on NVDA’s three computers utilized to build physical AI. This includes NVIDIA Omniverse for robotic simulation workflows.
In January, the company and the University of California, San Francisco Department of Radiology & Biomedical Imaging, announced the launch of a Care Innovation Hub, a joint research collaboration. The collaboration aims to address meaningful clinical challenges in three key areas, accessibility to advanced medical imaging, non-invasive diagnosis and management of neurological, and neurodegenerative disease and precision oncology.
In the same month, GEHC and Sutter Health entered into a seven-year strategic enterprise partnership, known as a Care Alliance, to increase access to innovative imaging services and create a more seamless and coordinated experience for clinicians and patients across the Sutter Health system.
Strong Q4 Results: GE HealthCare exited fourth-quarter 2024 with decent results, wherein earnings and revenues improved year over year. Total company orders increased 6% organically year over year. Revenues were driven by strength in the U.S. market across all segments, especially in the Advanced Visualization Solutions and Pharmaceutical Diagnostics segments.
GEHC’s net income margin was 13.5%, up 580 basis points from the prior-year period due to productivity and pricing benefits.
Factors That May Offset the Gains for GEHC
Stiff Competition: The presence of a large number of players has made the medical devices market highly competitive. The company faces competition from similar global and regional participants, which may vary by segment and product line.
The primary global competitors in the industries it serves are Siemens Healthineers, Philips Healthcare, Canon and United Imaging. In the Pharmaceutical Diagnostics business segment, it primarily competes with Bayer, Bracco, Guerbet, Lantheus and Curium.
Rising Tariffs to Hurt Business Growth: GE HealthCare faces potential challenges in 2025 due to new U.S. tariffs on Chinese imports, impacting its cost structure and profitability. The company expects a 10-basis-point hit to the adjusted EBIT margin, factoring in 11 months of tariff costs. Higher material costs, especially for imaging equipment and electronic components, along with possible supply-chain disruptions, pose risks. While lean manufacturing and supplier partnerships may cushion some impact, prolonged tariffs could pressure margins and pricing.
Estimate Trend of GEHC
GEHC is witnessing a positive estimate revision trend for fiscal 2025. In the past 60 days, the Zacks Consensus Estimate for earnings improved 2 cents to $4.70 per share.
The Zacks Consensus Estimate for first-quarter fiscal 2025 revenues is pegged at $4.66 billion, indicating a 0.2% improvement from the year-ago quarter’s reported number. The consensus mark for EPS was pinned at $0.91, implying an improvement of 1.1% year over year.
Masimo’s shares have rallied 30.1% in the past year. Estimates for MASI’s 2024 earnings per share (EPS) have increased 1.2% to $4.10 in the past 30 days. MASI’s earnings beat estimates in each of the trailing four quarters, the average surprise being 17.1%. In the last reported quarter, it posted an earnings surprise of 16.6%.
Estimates for Boston Scientific’s 2025 EPS have jumped 2.9% to $2.85 in the past 30 days. Shares of the company have surged 56.7% in the past year compared with the industry’s growth of 12.5%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.25%. In the last reported quarter, it delivered an earnings surprise of 7.69%.
Estimates for Cardinal Health’s fiscal 2025 EPS have increased 1.5% to $7.94 in the past 30 days. Shares of the company have gained 15.2% in the past year against the industry’s 4.1% decline. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%. In the last reported quarter, it delivered an earnings surprise of 10.3%.
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 GEHC Stock in Your Portfolio for Now
GE HealthCare Technologies, Inc. (GEHC - Free Report) is well-poised for growth in the coming quarters, courtesy of its continued focus on innovations. The optimism, led by strong fourth-quarter 2024 performance and acquisitions, is expected to contribute further. However, geopolitical tensions and stiff competition are concerning.
This Zacks Rank #3 (Hold) company’s shares have lost 11.6% in the past six months against the 1.2% growth of the industry. The S&P 500 composite has lost 0.9% during the said time frame.
The renowned provider of medical technology, pharmaceutical diagnostics and digital solutions has a market capitalization of $37.27 billion. The company projects 6.2% growth for the next five years and expects to maintain its strong performance going forward. It delivered a trailing four-quarter average earnings surprise of 6.17%.
Image Source: Zacks Investment Research
Factors Favoring GEHC’s Growth
Macro Tailwinds Boost Performance: GE HealthCare’s strong growth across all its segments and regions is primarily being driven by macro tailwinds, including the easing of supply-chain challenges. This trend is likely to continue in 2025. Moreover, robust demand and improved pricing of its products look promising. Key products driving revenue growth are Magnetic Resonance (“MR”), MI, CT, general imaging and women's health products. The company expects organic revenue growth of 2-3% in 2025. It had an order backlog worth $19.8 billion at the end of December 2024.
Innovations Supporting Growth: GE HealthCare’s commitment to drive innovation has allowed it to achieve continuous, significant improvements. Recently the company announced the launch of Invenia Automated Breast Ultrasound Premium, the latest 3D ultrasound offering advanced artificial intelligence (AI) and innovative features to drive faster, reproducible supplemental screening and streamline exam readings on patients with dense breasts.
Earlier this month, GEHC announced the launch of the AltiX AI.i edition of Mac-Lab, CardioLab and ComboLab. The AltiX AI.i edition is expected to enhance efficiency and precision care for multiple types of cardiac procedures. The latest launch is expected to significantly strengthen GE HealthCare’s CardioVascular & Interventional Solutions unit, thus boosting its Advanced Visualization Solutions business.
Also, GEHC unveiled the Genesis portfolio, a portfolio of cloud enterprise imaging software-as-a-service solutions designed to modernize healthcare data management. Genesis is likely to offer scalable, secure and interoperable solutions that help hospitals and health systems streamline workflows, enhance patient data access and reduce operational costs.
Last month, GEHC unveiled Freelium, a next-generation sealed magnet platform at ECR 2025, designed to revolutionize MR imaging. The platform uses less than 1% of helium compared with traditional systems, promoting sustainability and expanding access to quality imaging in helium-scarce regions.
In January, it announced receiving FDA 510(k) clearance for updated Voluson Expert Series ultrasound systems. This advanced portfolio, which includes the Voluson Expert 22, 20 and 18, sets a new benchmark in women’s healthcare by combining exceptional image quality, cutting-edge ultrasound technology and ergonomic design to enhance workflow efficiency and deliver an unparalleled user experience.
Acquisitions & Partnerships: GE HealthCare has several partnership agreements that help attract long-term customers for its products and services. GEHC is also focused on acquiring companies that will help it grow.
Recently, GEHC announced an expansion of its collaboration with NVIDIA Corporation to advance AI-driven autonomous solutions, which were designed to ease the growing burden on healthcare professionals.GE HealthCare aims to develop AI-enabled X-ray and ultrasound systems by leveraging the new NVIDIA Isaac for Healthcare platform, built on NVDA’s three computers utilized to build physical AI. This includes NVIDIA Omniverse for robotic simulation workflows.
In January, the company and the University of California, San Francisco Department of Radiology & Biomedical Imaging, announced the launch of a Care Innovation Hub, a joint research collaboration. The collaboration aims to address meaningful clinical challenges in three key areas, accessibility to advanced medical imaging, non-invasive diagnosis and management of neurological, and neurodegenerative disease and precision oncology.
In the same month, GEHC and Sutter Health entered into a seven-year strategic enterprise partnership, known as a Care Alliance, to increase access to innovative imaging services and create a more seamless and coordinated experience for clinicians and patients across the Sutter Health system.
Strong Q4 Results: GE HealthCare exited fourth-quarter 2024 with decent results, wherein earnings and revenues improved year over year. Total company orders increased 6% organically year over year. Revenues were driven by strength in the U.S. market across all segments, especially in the Advanced Visualization Solutions and Pharmaceutical Diagnostics segments.
GEHC’s net income margin was 13.5%, up 580 basis points from the prior-year period due to productivity and pricing benefits.
Factors That May Offset the Gains for GEHC
Stiff Competition: The presence of a large number of players has made the medical devices market highly competitive. The company faces competition from similar global and regional participants, which may vary by segment and product line.
The primary global competitors in the industries it serves are Siemens Healthineers, Philips Healthcare, Canon and United Imaging. In the Pharmaceutical Diagnostics business segment, it primarily competes with Bayer, Bracco, Guerbet, Lantheus and Curium.
Rising Tariffs to Hurt Business Growth: GE HealthCare faces potential challenges in 2025 due to new U.S. tariffs on Chinese imports, impacting its cost structure and profitability. The company expects a 10-basis-point hit to the adjusted EBIT margin, factoring in 11 months of tariff costs. Higher material costs, especially for imaging equipment and electronic components, along with possible supply-chain disruptions, pose risks. While lean manufacturing and supplier partnerships may cushion some impact, prolonged tariffs could pressure margins and pricing.
Estimate Trend of GEHC
GEHC is witnessing a positive estimate revision trend for fiscal 2025. In the past 60 days, the Zacks Consensus Estimate for earnings improved 2 cents to $4.70 per share.
The Zacks Consensus Estimate for first-quarter fiscal 2025 revenues is pegged at $4.66 billion, indicating a 0.2% improvement from the year-ago quarter’s reported number. The consensus mark for EPS was pinned at $0.91, implying an improvement of 1.1% year over year.
Stocks to Consider
Some better-ranked stocks in the broader medical space are Masimo (MASI - Free Report) , Boston Scientific (BSX - Free Report) and Cardinal Health (CAH - Free Report) . At present, Masimo sports a Zacks Rank #1 (Strong Buy), whereas Boston Scientific and Cardinal Health carries a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
Masimo’s shares have rallied 30.1% in the past year. Estimates for MASI’s 2024 earnings per share (EPS) have increased 1.2% to $4.10 in the past 30 days. MASI’s earnings beat estimates in each of the trailing four quarters, the average surprise being 17.1%. In the last reported quarter, it posted an earnings surprise of 16.6%.
Estimates for Boston Scientific’s 2025 EPS have jumped 2.9% to $2.85 in the past 30 days. Shares of the company have surged 56.7% in the past year compared with the industry’s growth of 12.5%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.25%. In the last reported quarter, it delivered an earnings surprise of 7.69%.
Estimates for Cardinal Health’s fiscal 2025 EPS have increased 1.5% to $7.94 in the past 30 days. Shares of the company have gained 15.2% in the past year against the industry’s 4.1% decline. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%. In the last reported quarter, it delivered an earnings surprise of 10.3%.