Merit Medical Systems, Inc. (MMSI Quick QuoteMMSI - Free Report) is well-poised for growth in the coming quarters, courtesy of its strong product portfolio. The optimism, led by a solid product performance and its continued spending on research and development, is expected to contribute further. However, tariffs and trade policy headwinds, and China macro pressure persist.

This Zacks Rank #3 (Hold) company’s shares have declined 20% in the year-to-date period compared with the industry’s 1.8% drop. However, the S&P 500 has risen 0.5% during the same time frame.

The renowned medical device provider has a market capitalization of $4.21 billion. The company projects 9.5% growth for the next five years and expects to maintain its strong performance going forward. It delivered an average earnings surprise of 13.2% for the past four quarters.

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Let’s delve deeper.

MMSI’s Growth Drivers

Strength in Cardiovascular & Peripheral Intervention Devices: The cardiovascular segment remains the main growth engine for Merit Medical, showing strong results driven by cardiac and peripheral intervention products. Cardiac intervention sales remain supported by demand for electrophysiology, cardiac rhythm management, angiography and vascular access offerings.

Peripheral intervention product growth is driven by strong sales in radar localization and delivery systems, reflecting wider adoption across embolotherapy, drainage, angiography and access categories. This momentum is expected to persist into 2026.

Expansion of Therapeutic Products & Innovation: Merit Medical’s therapeutic portfolio is outpacing its foundational products, emerging as a growth driver. Foundational products delivered a 6% CAGR over the past three years. In comparison, therapeutic products have grown with a 19% CAGR over the same period. This segment has become a major growth driver, reflecting rising physician adoption of devices that focus on treatment rather than procedural support.

Product Innovation & Acquisitions: Growth in 2025 was supported by a mix of internal product development and acquisitions. Product launches such as the Resilience Through-the-Scope Esophageal Stent, Prelude SNAP system, Ventrax Delivery System, Prelude radial sheath and SCOUT radar localization system gained traction. The recent acquisition of View Point Medical is projected to generate between $2 million and $4 million in revenues in 2026.

Key Challenges for MMSI Stock

Tariffs & Trade Policy Pressuring Margins: Tariffs weighed on gross margin performance in fourth-quarter 2025, with a 112-basis-point year-over-year impact. Management expects this pressure to continue into 2026. Guidance for the year includes a projected tariff impact of $15 million, or 19 cents per share, compared with $9 million, or 12 cents per share, recorded during the last eight months of 2025.

In the near term, tariffs are expected to create an 80-basis-point, or $3 million, gross margin impact in first-quarter 2026, which adds uncertainty around future cost pressure and margin performance.

OEM Weakness & China Macro Pressure: The company saw weakness in its OEM business in the United States due to softer performance driven by customer inventory destocking, which reduced order volumes from OEM partners. Outside the United States, demand faced pressure in China due to the impact of the country’s volume-based procurement program, which has pressured pricing across medical device categories.

Despite near-term volatility, the company expects the OEM segment to return to a mid- to high-single-digit growth range over time, though near-term fluctuations may persist.

Merit Medical Systems, Inc. Price

Merit Medical Systems, Inc. price | Merit Medical Systems, Inc. Quote

Estimate Trend

MMSI is witnessing a positive estimate revision trend for 2026. In the past 60 days, the Zacks Consensus Estimate for earnings per share (EPS) has moved 0.5% north to $4.07.

The Zacks Consensus Estimate for the company’s first-quarter 2026 revenues is pegged at $377.5 million, suggesting a 6.23% rise from the year-ago reported number. The consensus mark for EPS is pegged at 84 cents, implying a 2.3% decline from the prior-year reported figure.

Stocks to Consider

Some better-ranked stocks from the broader medical space are Pacific Biosciences of California (PACB Quick QuotePACB - Free Report) , Cardinal Health (CAH Quick QuoteCAH - Free Report) and GE HealthCare Technologies (GEHC Quick QuoteGEHC - Free Report) .

Pacific Biosciences of California, currently sporting a Zacks Rank #1 (Strong Buy), has an estimated earnings recession rate of 1.9%. PACB’s earnings surpassed estimates in the trailing four quarters, the average surprise being 27.7%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Pacific Biosciences’ shares have lost 16% compared with the industry’s 12.9% decline in the year-to-date period.

Cardinal Health, carrying a Zacks Rank #2 (Buy) at present, has an estimated long-term growth rate of 15%. CAH’s earnings surpassed estimates in the trailing four quarters, the average surprise being 9.3%.

Cardinal Health’s shares have gained 4.6% against the industry’s 1.9% decline in the year-to-date period.

GE HealthCare Technologies, currently carrying a Zacks Rank #2, has an estimated long-term earnings growth rate of 9.1%. GEHC’s earnings surpassed estimates in the trailing four quarters, the average surprise being 7.5%.

GE HealthCare Technologies’ shares have lost 9% compared with the industry’s 13.4% decline in the year-to-date period.