Boston Scientific BSX is gaining traction in the international markets. New regulatory approvals and accretive acquisitions bode well for long-term growth. The stock carries a Zacks Rank #2 (Buy) currently.

Factors Driving BSX Shares

Boston Scientific continues to successfully expand operations across different geographies outside the United States. In 2023, 41% of the company’s consolidated revenues came from international regions. In Europe, Middle East and Africa (EMEA), Boston Scientific has been successfully expanding its base banking on its diverse portfolio, new launches and commercial execution with healthy underlying market demand. In the third quarter, EMEA sales grew 14.3% year over year on an operational basis, banking on above-market performance in Electrophysiology (EP), wherein the company successfully expanded its Pulsed field ablation (PFA) leadership, complex PCI and structural heart. In TAVI, Boston Scientific received a CE Mark and launched the next-generation ACURATE Prime Valve.

Boston Scientific’s Endoscopy business within MedSurg is gaining from strong worldwide demand for its broad range of gastrointestinal (GI) and pulmonary treatment options. Particularly, the company is gaining market share driven by the above-market growth of AXIOS and Exalt D in the third quarter. The company also registered strong double-digit growth in the Endoluminal Surgery franchise and recently received a Category 1 CPT code for the ESG weight loss procedure, which is expected to increase momentum within this business.

We are impressed with Boston Scientific’s recent acquisitions that have added numerous products (though many are under development) with immense potential. This, in turn, should help boost the top line in the long term.

The company’s recently completed strategic buyouts include the acquisition of Silk Road Medical for $1.16 billion. This acquisition is expected to help the company progress in vascular medicine, where Silk Road has revolutionized stroke prevention and the treatment of carotid artery disease. Boston Scientific also expects to close the previously announced acquisition of Axonics in the fourth quarter of 2024. With this $3.7-billion acquisition, the company expects to expand its differentiated technologies portfolio within Urology.

Boston Scientific Corporation Price

Boston Scientific Corporation price | Boston Scientific Corporation Quote

Over the past three months, shares of BSX have gained 12.7% compared with the industry’s 8% growth. The company’s consistent efforts to expand in international markets and an array of new product launches are expected to help the stock continue its uptrend in the coming days.

Downside Risks for BSX Stock

The industry-wide difficult macroeconomic conditions in the form of geopolitical pressure, leading to disruptions in economic activity, global supply chains and labor markets, are creating a challenging business environment for Boston Scientific. With the sustained macroeconomic pressure, the company may struggle to keep its operating expenses in check. In the third quarter of 2024, the company reported a 19.2% rise in the cost of products sold, leading to a mere 5 basis points expansion in gross margin. Further, there was a 25.8% rise in selling, general and administrative expenses, resulting in a 123-basis point contraction in operating margin.

With Boston Scientific recording 40% of its sales from the international market, it remains highly exposed to currency fluctuations. Unfavorable currency movements have been a major dampener over the last few quarters, as in the case of other important MedTech players, too. In 2023, the company witnessed an approximate 80 basis-point headwind from foreign exchange on revenues. Again, in the third quarter of 2024, the company had a 10 basis-point impact on revenues from unfavorable currency fluctuations.

Other Key Picks

Some other top-ranked stocks in the broader medical space are Stryker SYK, Globus Medical GMED, and ResMed RMD, each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stryker’s shares have risen 27.5% in the past year. Estimates for the company’s earnings per share (EPS) have increased 0.3% to $12.04 for 2024 and 0.4% to $13.51 for 2025 in the past seven days. SYK’s earnings beat estimates in each of the trailing four quarters, delivering an average beat of 4.04%. In the last reported quarter, it posted an earnings surprise of 3.2%.

Estimates for Globus Medical’s 2024 EPS have remained constant at $2.84 in the past 30 days. Shares of the company have surged 60.6% in the past year compared with the industry’s growth of 32.7%. GMED’s earnings surpassed estimates in each of the trailing four quarters, with the average beat being 12.1%. In the last reported quarter, it delivered an earnings surprise of 10.3%.

Estimates for ResMed’s fiscal 2025 EPS have risen 2.7% in the past 30 days. Shares of the company have surged 86.3% in the past year compared with the industry’s 32.1% growth. RMD’s earnings surpassed estimates in each of the trailing four quarters, with the average beat being 6.4%. In the last reported quarter, it delivered an earnings surprise of 8.4%.

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