Home Market News <!DOCTYPE html> <html> <head> <title>Baird Bullish on Alcon and Axonics: Top Medtech Picks for 2024</title> </head> <body> Baird Bullish on Alcon and Axonics: Top Medtech Picks for 2024

Baird Bullish on Alcon and Axonics: Top Medtech Picks for 2024 Baird Bullish on Alcon and Axonics: Top Medtech Picks for 2024

0
<!DOCTYPE html>
<html>
  <head>
    <title>Baird Bullish on Alcon and Axonics: Top Medtech Picks for 2024</title>
  </head>
  <body>
    Baird Bullish on Alcon and Axonics: Top Medtech Picks for 2024
Bull and bear shape writing by lines and dots.

sutthirat sutthisumdang

Baird has picked Alcon (NYSE:ALC), Stryker (NYSE:SYK), The Cooper Companies (NASDAQ:COO), Axonics (NASDAQ:AXNX), and Boston Scientific (NYSE:BSX) as the top medtech choices for 2024.

Despite underperformance against the S&P 500 for three consecutive years, Baird expresses optimism about the medtech sector’s prospects in 2024. This is fueled by diminishing concerns about the impact of GLP-1 drugs, robust topline fundamentals, and improving margins.

Baird believes that valuations have started to incorporate concerns about GLP-1s, the upcoming US elections, and macroeconomic issues. Additionally, medtech is considered a defensive play during times of economic uncertainty and is less influenced by elections compared to other healthcare subsectors.

The investment firm is confident that focusing on high-quality companies with robust new product cycles and pricing power can lead to exceptional performance. It also anticipates margin recovery in 2024, driven by new product launches, enhanced pricing power, and normalized supply chains.

Baird places Alcon, Stryker, and Cooper at the top due to their strong product cycles and pricing power. While Alcon’s shares may not be inexpensive, Baird believes concerns about AT-IOLs and cataract volumes are exaggerated. The investment bank remains optimistic about Alcon’s contact lens co-specific cycle and the sustainability of contact lens pricing tailwinds. It anticipates a robust year for margin improvement in 2024.

Baird also favors Cooper for similar reasons, although it gives preference to Alcon’s surgical over CooperSurgical. The investment firm expects Alcon to experience more significant margin expansion in 2024 in comparison to Cooper.

Regarding Stryker, Baird believes that the company’s margins will benefit in 2024 from premium prices associated with its MedSurg product launches. Moreover, it anticipates robust demand trends in the orthopedic end-market and continued core ortho share gains driven by robots.

There is strong conviction in the revenue and profit potential of Boston Scientific and Axonics for FY 2024 and FY 2025. Baird predicts revenue/profit upside for these companies, with Axonics positioned to gain share in the US sacral neuromodulation market and emerging as a CNS long.

Baird also sees new “meaningful” product launches propelling Boston Scientific towards accelerating revenue growth into 2025, with margin improvements supporting a premium valuation for BSX. However, Baird mentions that Inspire Medical Systems (INSP) and Intuitive Surgical (ISRG) narrowly missed the top picks list due to valuation and potential near-term headline risk.