Market Overview

JPMorgan Diagnoses The MedTech Space: Stock Picks And Pans


The medical technology space for the most part benefited throughout 2017 and heading into 2018 some Wall Street analysts remain bullish.

The Analyst

JPMorgan's Michael Weinstein.

The Thesis

2017 was a positive year for the MedTech space and was able to overcome multiple challenges, including tough comparisons, a disruption in terms of manufacturing and demand from hurricanes, and a rising interest rates, Weinstein said in a note. But looking towards 2018, the industry-wide fundamentals are strong and sector revenue growth could re-accelerate from 4.4 percent last year to 5.1 percent in the new year.

Specifically, 2018 will be favorable for the group due to the release of new products, an economic backdrop that is "as good as it gets" with consumer confidence at a 17-year high and unemployment at a 10-year low, and tax reform and forced repatriation could create a new round of buybacks and M&A.

Here is a summary of the firm's top picks and pans.

  • Top large-cap picks: 1) Baxter International Inc (NYSE: BAX), 2) Zimmer Biomet Holdings Inc (NYSE: ZBH)
  • Top small-cap picks: 1) Intersect ENT Inc (NASDAQ: XENT), 2) Irhythm Technologies Inc (NASDAQ: IRTC)
  • Names with Underweight ratings: Accuray Incorporated (NASDAQ: ARAY), ConforMIS Inc (NASDAQ: CFMS), Endologix, Inc. (NASDAQ: ELGX)

Related Links:

5 Hot Stocks To Start 2018

The Week Ahead: New Year Still Presents Some Earnings And Other Catalysts


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