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Alberto Abaterusso
Alberto Abaterusso
Articles (1701) 

Boston Scientific Rises on 4th-Quarter Results

The medical devices producer beat consensus on earnings

February 06, 2019 | About:

Boston Scientific Corp. (NYSE:BSX) reported fourth-quarter earnings before the opening bell on Wednesday. 

The company posted non-GAAP earnings of 39 cents per share, beating consensus estimates by 3 cents per share, and GAAP earnings of 27 cents per share, topping estimates by  7 cents. Both firgures improved from the prior-year quarter. 

The Marlborough, Massachusetts-based medical devices producer recorded $2.56 billion in revenue, reflecting a 6.2% increase year over year. The company's results were in line with analysts' expectations.

Compared to the year-ago period, Boston Scientific reported a 7.4% increase in sales from the MedSurg segment to $800 million, a 5.1% growth in sales from the Rhythm Management and Neuro segment to $790 million and a 6.3% rise in sales from the Cardiovascular segment to $970 million.

U.S. sales increased 7% to $1.459 billion, sales in Europe, the Middle East and Africa grew 5.1% to $557 million, the Asia-Pacific region saw revenue jump 5.2% to $445 million and sales in Latin America and Canada rose 7.2% to $101 million. Revenue from emerging markets grew 16.8% to $278 million.

The company is hoping to grow organically and through acquisitions. As part of this initiative, Boston Scientific is acquiring BTG PLC (BTGGF) (LSE:BTG), which develops devices for the treatment of cancer and vascular diseases. It has also purchased Millipede Inc., which is a developer of devices used to treat patients with serious functional mitral regurgitation, meaning they cannot undergo open-heart surgery.

The company has also settled several disputes with Edwards Lifesciences Corp. (NYSE:EW) in regard to medical devices designed to treat cardiovascular diseases.

Boston Scientific is making progress on a series of new devices and therapies and has received the Food and Drug Administration's approval for its bioabsorbable stent, Synergy, and its Vercise Deep Brain Stimulation system.

The company has also launched the SpyScope catheter for the treatment of gallbladder stones and the AdVance system as a treatment for male patients suffering from urinary incontinence.

Boston Scientific has guided GAAP earnings of 32 cents to 33 cents per share for the first quarter of 2019 and earnings from $1.13 to $1.18 per share for full-year 2019. Non-GAAP earnings are expected to range from 35 cents to 36 cents for the quarter and fall between $1.53 and $1.58 for full fiscal 2019.

The share price was up 1.25% to $38.22 per share in early trading on Wednesday for a market capitalization of approximately $52.24 billion.

The stock has gained 7% so far this year, but underperformed the S&P 500 exchange-traded fund by about 2%.

The 52-week range is $25.04 to $39.44.

The price-book ratio is 6.3 versus an industry median of 3.06, the price-sales ratio is 5.46 versus an industry median of 3.15 and the price-earnings ratio is 80.32 versus an industry median of 30.17.

Boston Scientific does not pay a dividend.

During the final quarter of 2018, Ken Fisher (Trades, Portfolio) started a position in the company, buying 10,363 shares.

The Vanguard Health Care Fund (Trades, Portfolio) has reduced its holding by 2.16% to 30,718,414 shares and Mario Gabelli (Trades, Portfolio) reduced his position by 4.44% to 227,214 shares.

Disclosure: I have no positions in any securities mentioned in this article.

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About the author:

Alberto Abaterusso
If somebody asks what being a value investor means, Alberto Abaterusso would answer, “The value investor is not just the possessor of the security that represents the company, but he is the owner of that company. As an owner of the company the value investor is actively involved in the dynamics of that company and his first concern is how to have sales progressively growing. Also, the value investor is probably one of the most demanding persons in the world concerning sales.”

Abaterusso is a freelance writer based in The Netherlands. He primarily writes about gold, silver and precious metals mining stocks. His articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. Alberto holds an MBA from Università degli Studi di Bari (Italy), Aldo Moro.

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