Boston Scientific (BSX), a medical giant that exceeded first-quarter expectations, is benefiting from a recovery in medical procedures. BSX's stock yoyoed as a result and ended up about flat.
Boston Scientific's organic sales increased by 14%, to $3.39 Billion. Vijay Kumar, an Evercore ISI analyst, said that this was far above the company’s guidance of 6%-8% growth in organic sales. The company earned adjusted 47 cents a share, which is up 21% from last year.
FactSet reported that both measures exceeded expectations of $3.16 billion sales and 43 cents per share.
Kumar stated that "all in all, these results were solid and reaffirm the medtech procedures rebound thesis."
BSX closed today's market at 51.10, which is roughly the same as yesterday. Medical-Products fell less than 1%.
In mid-January, the number of weekly Covid cases reported by the Centers for Disease Control and Prevention reached a peak of 5.5 million. There have been smaller waves below the 1 million mark since then, but overall, cases have dropped.
This paradigm shift has enabled hospitals to return back to normal procedure volume, which helps firms like Boston Scientific, who sells pacemakers and heart valve replacements as well as neuromodulation devices, among other implantable technologies.
Boston Scientific's Cardiovascular unit saw organic sales grow 14.4%, compared to Kumar's forecast of 9.6%. Medical-surgical sales grew 13.4%, exceeding Kumar's forecast of 9.2% growth.
Kumar maintained his Outperform rating on BSX and his 54-price target.
Boston Scientific has increased its previous view of 6%-8% organic growth to 8%-10% for the year. According to the strictest reporting, Boston Scientific expects to see sales grow by 8.5%-10.5%. This would translate to $13.89 Billion at the midpoint, just above analysts' forecasts of $13.54 Billion.
Analysts had predicted $1.91 per share, but Boston Scientific expects adjusted earnings of $1.90 to $1.96 per share.
According to MarketSmith.com, BSX recently broke through a flat bottom with a purchase point of 48.97. Investors should take profits when the stock price rises by 20%-25% over its entry. This zone is between 58.76 and 61.21 in the case of Boston Scientific.
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Investor's Business Daily published the article Boston Scientific Yo-Yoes as Medical Recovery Drives Q3 Beat.