Becton Dickinson and Co’s (NYSE: BDX) stock has lost more than 10 percent since March 15 in response to the FDA update on drug-coated balloons, or DCBs.
The market seems to have overreacted to the news, and the upcoming FDA Advisory Committee meeting scheduled for June 19-20 may ease concerns, according to Barclays.
Becton Dickinson gained the Lutonix DCB business when it acquired CR Bard in 2018. DCBs represented an estimated $200 million in sales and were among the company’s faster-growing product-lines, Stewart said in the Monday upgrade note. (See her track record here.)
DCB sales have taken a hit due to safety concerns that emerged in December and grew after the January and March FDA advisory letters, the analyst said. Becton Dickinson subsequently reduced its 2019 guidance to incorporate lower DCB sales expectations as well as forex headwinds, she said.
Barclays reduced its 2019 and 2020 EPS estimates from $11.90 to $11.69 and from $13.15 to $12.90, respectively, mainly to reflect currency headwinds.
Market expectations have declined to an extent that leaves the upcoming FDA Advisory Committee meeting as a potential positive catalyst for the company’s shares, Stewart said.
Becton Dickinson should appreciate as visibility on DCBs increases and “the market comes to appreciate BD’s business/product diversity and sustainability of growth," the analyst said.
Shares of Becton Dickinson were trading up 0.33 percent to $226.21 at the time of publication Monday.
Benzinga's Top Upgrades, Downgrades For May 13, 2019
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|May 2019||Maintains||Market Perform|
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