As healthcare providers worldwide adopt advanced technologies to improve patient outcomes, the medical devices sector is experiencing a significant surge in demand. This growth is fueled by an aging global population, increasing chronic disease prevalence, and the ongoing need for more effective diagnostic and treatment tools.
Amid this backdrop, investors might consider investing in three well-positioned medical device stocks, Boston Scientific Corporation (BSX), Becton, Dickinson and Company (BDX), and The Cooper Companies, Inc. (COO), for potential gains.
A major driver behind this upward trend is technological innovation. The integration of digital health solutions into medical devices is transforming the way healthcare is delivered. Devices now often incorporate data analytics, connectivity, and artificial intelligence to provide real-time insights and predictive diagnostics. Also, the medical device industry is poised to reach nearly $800 billion by 2030.
However, medical device companies are continually investing in research and development to introduce products that enhance precision, reduce invasiveness, and improve overall efficiency in procedures. Developments in robotic surgery, advanced imaging, and remote patient monitoring are revolutionizing the field.
With that in mind, let’s delve into the fundamentals of the three Medical - Devices & Equipment stock picks, beginning with the third choice.
Stock #3: Boston Scientific Corporation (BSX)
BSX develops, manufactures, and markets medical devices for use in various interventional medical specialties worldwide. The company operates through two segments: MedSurg and Cardiovascular. It provides devices to diagnose and treat gastrointestinal and pulmonary conditions.
On January 8, BSX announced its acquisition of Bolt Medical, Inc., the developer of an intravascular lithotripsy (IVL) advanced laser-based platform for the treatment of coronary and peripheral artery disease. This acquisition will allow BSX to expand its cardiovascular portfolio with a complementary and differentiated calcium modification platform, strengthening the company’s position in the market.
On November 25, BSX announced it entered into a definitive agreement to acquire Intera Oncology® Inc. This privately held medical device company provides the Intera 3000 Hepatic Artery Infusion Pump and floxuridine (a chemotherapy drug), both approved by the U.S. Food and Drug Administration. This acquisition enables the provision of a more comprehensive set of solutions to physicians and their patients who treat both primary and metastatic forms of liver cancer.
In terms of the trailing-12-month EBITDA margin, BSX’s 25.50% is 325.8% higher than the 5.99% industry average. Similarly, its 10.79% trailing-12-month levered FCF margin is 308.3% higher than the industry average of 2.64%. Also, its trailing-12-month asset turnover ratio of 0.45x compares to the industry average of 0.42x.
For the fourth quarter of 2024, which ended on December 31, BSX’s net sales increased 22.4% year-over-year, amounting to $4.56 billion. The company reported a gross profit of $3.09 billion, indicating a 20% increase from the prior year’s quarter. Its operating income rose 15.6% from the year-ago value to $675 million. In addition, BSX’s attributable adjusted net income came in at $1.04 billion and $0.70 per share, up 27.7% and 27.3% year-over-year, respectively.
As per the guidance for the full year 2025, BSX now forecasts GAAP EPS to be in the range of $1.86 to $1.93 and its non-GAAP EPS between $2.80 and $2.87.
The consensus revenue estimate of $4.57 billion for the fiscal first quarter (ending March 2025) represents an 18.5% increase year-over-year. The consensus EPS estimate of $0.67 for the same quarter indicates a 19.8% improvement year-over-year. The company has an excellent surprise history; it surpassed the consensus revenue and EPS estimates in three of the trailing four quarters.
BSX’s stock has surged 59.1% over the past year and 39.8% over the past nine months to close the last trading session at $105.36.
BSX’s stance is apparent in its POWR Ratings. The stock has an A grade for Sentiment and a B for Growth and Stability. The POWR Ratings are calculated by considering 118 different factors, each weighted to an optimal degree.
Among the 131 stocks in the Medical - Devices & Equipment industry, it is ranked #47. Click here to see the additional BSX ratings (Value, Momentum, and Quality).
Stock #2: Becton, Dickinson and Company (BDX)
BDX is a global medical technology company engaged in developing, manufacturing, and selling a broad range of medical supplies, devices, laboratory equipment, and diagnostic products for healthcare institutions, physicians, life science researchers, clinical laboratories, and more.
On January 23, BDX and Biosero, a developer of laboratory automation solutions to orchestrate scientific discoveries, announced a collaboration agreement to enable and facilitate robotic arm integration with BD flow cytometry instruments to accelerate drug discovery and development.
This collaboration will make automation possible for current and future biopharma companies and make it easy to use, scalable, and adaptable for the vital work of drug discovery and development.
In the same month, BDX announced that its partner, Carilion Clinic, a not-for-profit healthcare organization serving more than 1 million people in Virginia, provided its patients with needle-free blood draws using the BD® PIVO™ Pro Needle-free Blood Collection Device. The advanced PIVO™ Pro Technology allows clinicians to use a patient's existing peripheral IV catheter line for blood draws, leading to fewer needlesticks and less pain and anxiety for patients.
The stock’s trailing-12-month EBIT margin of 15.33% is 514.9% higher than the industry average of 2.49%. Similarly, its 3.46% trailing-12-month CAPEX/Sales is 9.7% above the industry average of 3.15%.
BDX’s revenues for the fourth quarter (ended December 31, 2024) increased 9.8% year-over-year to $5.17 billion. Its non-GAAP operating income is $453 million, indicating a 3.2% growth from the prior year’s quarter. The company’s net income came in at $303 million and $1.04 per share, up 7.8% and 8.3% year-over-year, respectively.
Looking ahead, BDX anticipates revenue for the fiscal year 2025 to be in the range of $21.7 billion-$21.9 billion. It also expects adjusted diluted EPS to lie between $14.30 and $14.60.
Street expects BDX’s revenue for the fiscal second quarter (ending March 2025) to increase 6.4% year-over-year to $5.37 billion. Its EPS for the same period is expected to register a 4% growth from the prior year, settling at $3.30. In addition, it surpassed the consensus EPS estimates in each of the trailing four quarters, which is promising.
Over the past three months, the stock has gained 2.5%, closing the last trading session at $227.93.
BDX’s POWR Ratings reflect this robust outlook. The stock has an overall rating of B, which equates to Buy in our proprietary rating system.
BDX has a B grade for Growth and Sentiment. It is ranked #38 out of 131 stocks in the same industry. Click here to see the additional ratings for BDX (Value, Momentum, Stability, and Quality).
Stock #1: The Cooper Companies, Inc. (COO)
COO is a medical device company that develops, manufactures, and markets contact lens wearers worldwide. The company operates in two segments: CooperVision and CooperSurgical.
COO's trailing-12-month EBIT margin of 18.17% is 628.9% higher than its respective industry average of 2.49%. Likewise, its trailing-12-month levered FCF margin of 5.28% is 99.7% above the industry average of 2.64%.
In the fourth quarter (ended October 31, 2024), COO’s net sales increased 9.8% year-over-year to $1.02 billion. The company reported a gross profit of $677.7 million, indicating an 11.7% growth from the prior year’s quarter. Its non-GAAP operating income increased 16.2% from the year-ago value to $263.3 million. COO’s non-GAAP net income came in at $208.5 million, up 20.4% year-over-year, while its earnings per share grew 19.5% from the prior-year quarter to $1.04.
According to the fiscal year 2025 financial guidance, COO forecasts total revenue to range from $4.08 billion to $4.158 billion. The company also expects non-GAAP EPS to be between $3.92 and $4.02.
Analysts expect COO’s revenue for the first quarter (ended January 2025) to increase 5.3% year-over-year to $981.25 million, while its EPS for the same period is expected to grow 7.2% from the prior year to $0.91. Moreover, it topped Street EPS estimates in each of the trailing four quarters, which is excellent.
The stock has gained 2.5% intraday to close the last trading session at $88.69.
COO’s bright prospects are reflected in its POWR Ratings. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system.
It also has a B grade for Value, Sentiment, and Quality. Within the same industry, it is ranked #20 out of 340 stocks. Click here to see COO’s ratings for Growth, Momentum, and Stability.
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BSX shares were trading at $104.35 per share on Friday afternoon, down $1.01 (-0.96%). Year-to-date, BSX has gained 16.83%, versus a 2.62% rise in the benchmark S&P 500 index during the same period.
About the Author: ShreyaRathi
