STJ ST. Jude Medical, Inc.

For Immediate Release

Chicago, IL – March 7, 2012 – Today, Zacks Equity Research discusses the MedTech Industry, including Medtronic Inc. ( MDT), Boston Scientific Corporation ( BSX), St. Jude Medical ( STJ), Edwards Lifesciences ( EW) and Varian Medical ( VAR).

 

A synopsis of today’s Industry Outlook is presented below. The full article can be read at  http://www.zacks.com/stock/news/70847/MedTech+Industry+Stock+Outlook+%96+March+2012 

In our universe, we see growth potential in companies dealing with cardiovascular devices, neuro and radiation oncology products. Names include Medtronic Inc. ( MDT), Boston Scientific Corporation ( BSX), St. Jude Medical ( STJ), Edwards Lifesciences ( EW) and Varian Medical ( VAR).

The above-listed companies make life-sustaining products and are less affected by economic instability. These companies are all leading players in their respective fields and are potential winners in the long run. Some of these players have been successful in weathering the storm (pricing, currency and volume headwinds) in the cardiovascular space.

With a slew of new products, the Big Three players (Medtronic, Boston Scientific and St. Jude) in the $6.5 billion implantable cardioverter defibrillator (“ICD”) market are well-positioned to gain market share, despite the challenging business environment and several other barriers to growth. These companies have a number of levers to pull and represent a good bet for long-term investors.

Among the names above, Medtronic, the undisputed leader in the MedTech space, has a diversified presence in cardiovascular, neuro, spinal, diabetes and ENT and boasts of an attractive pipeline. Despite sustained weaknesses in its key ICD and spinal implants businesses, we like the company’s efforts to augment/diversify its product range, expand into emerging markets for growth, and generate strong cash and healthy dividend yield. Besides, the new MRI SureScan pacemaker and Protects ICDs should offer support to its core CRM business.

Boston Scientific has maintained its leadership in the drug eluting stent (“DES”) market. The earlier-than-expected approval of the next-generation DES product Promus Element coupled with a new line of ICDs better places the company for 2012. Although Boston Scientific’s December quarter results were disappointing and its CRM segment remains challenging, we believe that the company’s continuous focus on strategic initiatives (including new products and cost cutting measures) to drive growth and profitability should yield steady results moving ahead.

Boston Scientific is leaving no stone unturned to stay on course for growth. It has undertaken a series of management changes and restructuring initiatives that are expected to contribute to the bottom line and margins. The company is also expanding its footprint in the emerging markets by reinvesting the savings from restructuring efforts.

We remain intrigued by St. Jude’s ability to consistently produce positive earnings surprises and revenue growth. The company is gaining ICD market share despite a sluggish market condition. St. Jude is poised for incremental opportunities in CRM on the back of strong product momentum. A surfeit of new growth drivers are expected to offer opportunities for accelerated sales growth over the next few years.

St. Jude recently won the U.S. approval for its Unify quadripolar CRT-D system. The device is expected to help the company win ground in the highly competitive U.S. defibrillator space in 2012. St. Jude is currently the only company to offer this technology globally. Moreover, St. Jude is well placed to leverage the solid growth momentum in the atrial fibrillation market.

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BOSTON SCIENTIF (BSX): Free Stock Analysis Report
 
EDWARDS LIFESCI (EW): Free Stock Analysis Report
 
MEDTRONIC (MDT): Free Stock Analysis Report
 
ST JUDE MEDICAL (STJ): Free Stock Analysis Report
 
VARIAN MEDICAL (VAR): Free Stock Analysis Report
 
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