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Medical Products Industry Gathering Steam: 3 Stocks to Buy

Nabaparna Bhattacharya

Over the past decade, the Medical Products industry has witnessed a major uptick in precision surgeries, gene therapies, hybrid closed-loop insulin delivery systems, continuous glucose-monitoring platforms, centralized monitoring of hospital patients and big-data based electronic health records (EHR). Additionally, a bipartisan two-year suspension of a 2.3% excise tax on Medical Product and Medical Device manufacturers at the beginning of 2018 has encouraged massive investments in the sector.

Meanwhile, per a CISION report, the United States is the largest Medical Products market in the world, raking in more than $180 billion a year, courtesy of rising research and development activities and growing exposure to artificial intelligence (AI).

Considering these trends, analysts and MedTech enthusiasts are expecting a significant progress in the Medical Products market. Thus, companies involved in developing wearable medical devices are likely to draw investors’ attention.

Burning Trends in the Medical Products Market

Prevalence of Medical Mechatronics & Robotics: Mechatronics, a high-end technology incorporating electronics, machine learning and mechanical engineering, has been in vogue now. Considering the strong presence of Mechatronics in almost all spheres like technology, automobile, telecom et al, the evolution of Mechatronics in the Medical Products industry has been most fascinating.

A Business Wire research deciphers that the global Mechatronics and Robotics market is projected to witness a CAGR of 15.02% during the 2017-2021 period.

Big Data Implications — EHRs:The latest trend of EHR, electronic medical records, predictive analytics, real-time alerting and revenue cycle management services in the U.S. Medical Products space has been gaining ground. Of these, the cloud-based EHR model is the most common application of big data in healthcare. According to Transparency Market Research, the worldwide EHR market is expected to see a 5.7% CAGR from 2017 to 2025 for reaching an estimated value of $38.29 billion.

Wearable Devices: Wearable devices market has been a major top-line contributor to the Medical Products industry. It is interesting to note that more than half of the American populace uses wearable devices to track calories, measure oxygen saturation (SpO2), monitor sleep, for fetal monitoring, pulse rate analysis, maintaining blood pressure and for self-glucose monitoring as well. Going by a recent study by the BrandEssence, the wearable medical devices market was valued at $6.58 billion in 2017 and is anticipated to reach worth $25.46 billion before 2024 at a CAGR of about 21.32%.

3 Medical Products Stocks Gaining Momentum

Per Moody’s Investors Service, the U.S. Medical Products industry will be aided by earnings growth from new products and solid demand in the emerging markets, which are envisioned to see a double-digit percentage increase in 2019.

Based on such tailwinds, we have zeroed in on three Medical Products companies, which carry a Zacks Rank #1 (Strong Buy) or 2 (Buy).

Surmodics, Inc. SRDX

The company has a Zacks Rank of 2. Surmodics has outperformed the industry in a year’s time. The stock has soared 75.2% versus the industry's mere decline of 5.2%. The return is also higher than the S&P 500 index's fall of 7%.

The company consistently gains from its core Medical Device and IVD units and this trajectory is expected to continue in fiscal 2019 as well. Management is also optimistic about the agreement with MedTech behemoth Abbott for commercialization of its SurVeil drug-coated balloon. Surmodics also expects to complete the TRANSCEND clinical study enrollment by fiscal 2019. Moreover, it is hopeful about its new product, AVess.

Surmodics, Inc. Price

 

Surmodics, Inc. Price | Surmodics, Inc. Quote

BioLife Solutions, Inc. (BLFS)

BioLifeis a Zacks #2 Ranked stock and has skyrocketed 119.1% in a year. The company delivered average positive surprise of 43.8% for the trailing four reported quarters.

Management at BioLife is upbeat about its flagship products like CryoStor and HypoThermosol, which currently notice a surge in demand. Management further stated that BioLife's proprietary biopreservation media product line has been used in more than 300 customer clinical applications including dozens of CAR T-cell and other T cell immunotherapies targeting blood cancers and solid tumors.

BioLife Solutions, Inc. Price

 

BioLife Solutions, Inc. Price | BioLife Solutions, Inc. Quote

MacroGenics, Inc. (MGNX)

This Zacks #2 Ranked player has achieved major milestones with Margetuximab in the SOPHIA breast cancer trial. The company’s sturdy improvement in the Phase 1b/2 gastric cancer study is encouraging.

Management also announced clinical advancement of MGA012 platform for its potential in treating solid tumor cancers. Additionally, the company’s two bispecific DART molecule programs are underway.

We expect MacroGenics’ share price to soar in 2019 based on its exclusive suite of products and solutions.

MacroGenics, Inc. Price

 

MacroGenics, Inc. Price | MacroGenics, Inc. Quote

More Stock News: This Is Bigger than the iPhone!                  

It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.

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