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Here's Why You Should Buy Masimo (MASI) Stock Right Now

Zacks Equity Research

Masimo Corporation MASI has been gaining investor confidence on continued positive results. Over the past year, the stock has rallied 48.1% against the industry’s 3.9% decline. Also, the company has outperformed the S&P 500’s 7.3% rise.

The company has an encouraging earnings surprise history, having outpaced the Zacks Consensus Estimate in each of the trailing four quarters, the average being 6.6%. Notably, the consecutive beats underline its operating efficiency. A solid view for 2019 and a slew of developments are currently working in favor of the stock.

With solid prospects, this Zacks Rank #2 (Buy) stock is an attractive investment pick for now.

What’s Working in Favor?

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For 2019, Masimo expects total revenues of $919 million on a reported basis and $918 million on an adjusted basis, calling for year-over-year growth of 10.6% at cc. The projected figure is above the previously communicated $912 million.

Earnings per share (EPS) are expected to be $3.25 compared with $3.19 stated earlier. On an adjusted basis, EPS is anticipated at $3.12, up from the previously-stated figure of $3.08.


Masimo has been riding on a slew of developments in recent times.

For instance, earlier this month, the company received FDA clearance for its O3 Regional Oximetry for utilization on neonatal and infant patients weighing less than 10 kgs. This clearance is likely to expand Masimo’s O3 platform. (Read More: Masimo's O3 Oximetry Gets FDA Nod, Boosts Patient Monitoring)

In the pediatric care space too, Masimo has fortified its foothold. Notably, the company’s technologies like SET, Root with Radical-7, NomoLine Capnography and Patient SafetyNet have been recently deployed by NuVision Management Healthcare Consulting Company at its facilities in New Jersey and Florida.

Additionally, a variety of other rainbow SET parameters and NomoLine capnography, available as a MOC-9 expansion module for Root, will be used to support management of children on ventilators.

Last month, Masimo received a 510(k) clearance from the FDA for Radius PPG. This FDA nod will prove beneficial for the company as Radius PPG utilizes the power of the clinically-proven Masimo SET technology that will deliver accurate measurement while the patients are on the move. This in itself is expected to be a significant breakthrough in patient monitoring.

Masimo Corporation Price and Consensus


Masimo Corporation Price and Consensus

Masimo Corporation price-consensus-chart | Masimo Corporation Quote

What Do Estimates Say?

The Zacks Consensus Estimate for second-quarter earnings per share is pegged at 73 cents. The same for revenues stands at $223 million, indicating a year-over-year rise of 5.4%.

The Zacks Consensus Estimate for full-year earnings is pegged at $3.12, suggesting 3% growth from 2018. The same for revenues stands at $919.4 billion, indicating a 7.1% rise.

Other Key Picks

A few other top-ranked stocks in the broader medical space are DENTSPLY SIRONA XRAY, Penumbra PEN and CONMED Corporation CNMD, each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

DENTSPLY’s long-term earnings growth rate is expected to be 11.5%.

Penumbra’s long-term earnings growth rate is projected at 21.5%.

CONMED’s long-term earnings growth rate is estimated at 13.3%.

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