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Here's Why You Should Retain Masimo Stock (MASI) For Now
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Masimo Corporation (MASI - Free Report) is gaining on strategic collaborations along with regulatory clearances. However, foreign exchange headwinds have been offsetting the positives to some extent.
The company, with a market capitalization of $13.46 billion, is a leading developer of non-invasive monitoring systems. The company’s earnings are expected to improve 21.7% over the next five years. Also, this Zacks Rank #3 (Hold) company has a trailing four-quarter positive earnings surprise of 6.5%, on average.
In the past three months, the stock has gained 36.5% against the 6.7% decline of its industry.
Let’s delve deeper into the factors working in favor of the company.
Positive Feedbacks: Masimo has been riding high on a series of regulatory approvals.
The company received a CE mark for neonatal use of its continuous hemoglobin monitoring technology, marking the company’s first SpHb technology.
Notably, in March 2020, the company obtained FDA clearance for the continuous RRp (respiration rate from the photoplethysmograph) monitoring of adult and pediatric patients with Rad-97, Radical-7 and Radius-7 Pulse CO-Oximeters. With this go-ahead, both continuous and spot-check RRp are now commercially available in the United States.
Patient-Monitoring in Focus: Masimo offers mobile as well as standalone units, allowing a patient to be monitored from the ambulance to the emergency room to the general floor, and through to discharge. The company’s new Root patient monitoring and connectivity platform integrates rainbow and SET technologies. Masimo Patient SafetyNet System is a remote monitoring (wireless) system which helps clinicians effectively monitor patient clinical data, especially on general floors of a hospital.
In March 2020, the company and University Hospitals collaborated to implement Masimo SafetyNet to help clinicians monitor patients remotely.This is likely to ramp up demand for its patient monitoring systems, thereby facilitating remote monitoring at patients’ homes.
In recent times, the company announced Pathway, which is a feature for the Root Patient Monitoring and Connectivity Platform. Pathway is likely to aid clinicians in simplifying decision making associated with newborn resuscitation.
Collaborations and Acquisitions: In March 2020, the company inked a deal with Imprivata with respect to the integration of Imprivata Medical Device Access into Masimo’s Hospital Automation solutions that feature the Root Patient Monitoring and Connectivity Platform, and Iris Gateway. On the back of this newly-launched technology, hospitals are likely to benefit from a more powerful patient monitoring and hospital automation solution created to boost clinical workflows and efficacy in a number of ways.
Also, in March, the company extended its reach into care for respiratory patients through the acquisition of TNI Medical, a company in Germany producing high flow nasal cannula oxygen therapy. These are also expected to be driving growth in the near future.
In April, the company announced a tie-up with Samsung Electronics America to make the Masimo SafetyNet Patient App available on select Samsung smartphones. The collaboration is likely to enable faster and wider distribution of Masimo SafetyNet to COVID-19 patients, particularly the older patients who are less likely to own smartphones or have the ease to configure the app on their own.
However, there is a factor deterring growth for the company.
Foreign Exchange Woes: A strengthening U.S. dollar negatively impacts overseas revenues of MedTech companies. Hence, Masimo apprehends a $4-mllion impact on its 2020 product revenues.
Estimates Trend
The company is witnessing a negative estimate revision trend for fiscal 2020. Over the past 30 days, the Zacks Consensus Estimate for earnings has declined 11.5% to $3.14 per share.
The Zacks Consensus Estimate for second-quarter 2020 revenues is pegged at $289.3 million, suggesting a 25.9% rise from the year-ago reported number.
Aphria’s long-term earnings growth rate is estimated at 24.6%. The company presently carries a Zacks Rank #2 (Buy).
DexCom’s long-term earnings growth rate is estimated at 36.3%. The company presently carries a Zacks Rank #2.
Pacific Biosciences’ long-term earnings growth rate is estimated at 30%. It currently carries a Zacks Rank #2.
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This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
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Here's Why You Should Retain Masimo Stock (MASI) For Now
Masimo Corporation (MASI - Free Report) is gaining on strategic collaborations along with regulatory clearances. However, foreign exchange headwinds have been offsetting the positives to some extent.
The company, with a market capitalization of $13.46 billion, is a leading developer of non-invasive monitoring systems. The company’s earnings are expected to improve 21.7% over the next five years. Also, this Zacks Rank #3 (Hold) company has a trailing four-quarter positive earnings surprise of 6.5%, on average.
In the past three months, the stock has gained 36.5% against the 6.7% decline of its industry.
Let’s delve deeper into the factors working in favor of the company.
Positive Feedbacks: Masimo has been riding high on a series of regulatory approvals.
The company received a CE mark for neonatal use of its continuous hemoglobin monitoring technology, marking the company’s first SpHb technology.
Notably, in March 2020, the company obtained FDA clearance for the continuous RRp (respiration rate from the photoplethysmograph) monitoring of adult and pediatric patients with Rad-97, Radical-7 and Radius-7 Pulse CO-Oximeters. With this go-ahead, both continuous and spot-check RRp are now commercially available in the United States.
Patient-Monitoring in Focus: Masimo offers mobile as well as standalone units, allowing a patient to be monitored from the ambulance to the emergency room to the general floor, and through to discharge. The company’s new Root patient monitoring and connectivity platform integrates rainbow and SET technologies. Masimo Patient SafetyNet System is a remote monitoring (wireless) system which helps clinicians effectively monitor patient clinical data, especially on general floors of a hospital.
In March 2020, the company and University Hospitals collaborated to implement Masimo SafetyNet to help clinicians monitor patients remotely.This is likely to ramp up demand for its patient monitoring systems, thereby facilitating remote monitoring at patients’ homes.
In recent times, the company announced Pathway, which is a feature for the Root Patient Monitoring and Connectivity Platform. Pathway is likely to aid clinicians in simplifying decision making associated with newborn resuscitation.
Collaborations and Acquisitions: In March 2020, the company inked a deal with Imprivata with respect to the integration of Imprivata Medical Device Access into Masimo’s Hospital Automation solutions that feature the Root Patient Monitoring and Connectivity Platform, and Iris Gateway. On the back of this newly-launched technology, hospitals are likely to benefit from a more powerful patient monitoring and hospital automation solution created to boost clinical workflows and efficacy in a number of ways.
Also, in March, the company extended its reach into care for respiratory patients through the acquisition of TNI Medical, a company in Germany producing high flow nasal cannula oxygen therapy. These are also expected to be driving growth in the near future.
In April, the company announced a tie-up with Samsung Electronics America to make the Masimo SafetyNet Patient App available on select Samsung smartphones. The collaboration is likely to enable faster and wider distribution of Masimo SafetyNet to COVID-19 patients, particularly the older patients who are less likely to own smartphones or have the ease to configure the app on their own.
However, there is a factor deterring growth for the company.
Foreign Exchange Woes: A strengthening U.S. dollar negatively impacts overseas revenues of MedTech companies. Hence, Masimo apprehends a $4-mllion impact on its 2020 product revenues.
Estimates Trend
The company is witnessing a negative estimate revision trend for fiscal 2020. Over the past 30 days, the Zacks Consensus Estimate for earnings has declined 11.5% to $3.14 per share.
The Zacks Consensus Estimate for second-quarter 2020 revenues is pegged at $289.3 million, suggesting a 25.9% rise from the year-ago reported number.
Key Picks
Some better-ranked stocks from the broader medical space are Aphria. , DexCom (DXCM - Free Report) and Pacific Biosciences (PACB - Free Report) .You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Aphria’s long-term earnings growth rate is estimated at 24.6%. The company presently carries a Zacks Rank #2 (Buy).
DexCom’s long-term earnings growth rate is estimated at 36.3%. The company presently carries a Zacks Rank #2.
Pacific Biosciences’ long-term earnings growth rate is estimated at 30%. It currently carries a Zacks Rank #2.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2019, while the S&P 500 gained and impressive +53.6%, five of our strategies returned +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%.
This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.
See their latest picks free >>