Market Overview

Barclays Says Investors Underestimate St. Jude Medical 's Potential


Barclays said investors are underestimating St. Jude Medical, Inc.'s (NYSE: STJ) pipeline and growth potential in future periods as the addition of St. Jude will make Abbott Laboratories (NYSE: ABT) a leader in the Medical Devices business.

Late April, Abbott agreed to buy St. Jude for about $25 billion, creating a giant in the medical device space. St. Jude has leading positions in heart failure devices, atrial fibrillation and cardiac rhythm management that complements Abbott's coronary intervention and transcatheter mitral repair.

"While ABT has a leading stent business (helped by the recent US approval of ABSORB), STJ adds a #2 position in CRM that gives the combined entity key products to address the needs of cardiac surgeons, interventional cardiologists and EP's, and to contract with larger IDNs and GPOs. In addition, we continue to think the synergies laid out in the ABT/STJ transaction are achievable," analyst Matthew Taylor wrote in a note.

The comments come as St. Jude gets MRI approval for CRM devices in the US. The company had guided to a second half 2016 approval for its pacers and first half 2017 for high voltage devices.

In a related event, Boston Scientific Corporation (NYSE: BSX) this week announced FDA approval of its Emblem MRI (S-ICD) system, but pushed back the expectation for high voltage approval to 'year-end' 17.

"This should mean that STJ receives high voltage approval before BSX if the timelines hold and could accelerate the pace of STJ's revenue growth recovery, in our view," Taylor highlighted.

Taylor has an Equal-Weight rating and $83 price target on St. Jude.

Latest Ratings for STJ

Jul 2016WedbushDowngradesOutperformNeutral
Jul 2016Leerink SwannDowngradesOutperformMarket Perform
May 2016BarclaysDowngradesOverweightEqual-Weight

View More Analyst Ratings for STJ
View the Latest Analyst Ratings


Related Articles (STJ)

View Comments and Join the Discussion!

Posted-In: Barclays Matthew TaylorAnalyst Color Long Ideas Reiteration Analyst Ratings Trading Ideas

Latest Ratings

ESTCCanaccord GenuityMaintains150.0
AVAVCanaccord GenuityMaintains98.0
OKTACanaccord GenuityMaintains250.0
SNOWCanaccord GenuityMaintains275.0
RCMSVB LeerinkMaintains26.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at