Stryker (SYK) to Acquire Invuity, Boost Surgical Portfolio
Stryker Corporation SYK recently announced an agreement to acquire Invuity Inc. for approximately $190 million. This buyout is expected to augment Stryker’s surgical portfolio, thereby aiding the core Neurotechnology & Spine segment. The deal is expected to close in the fourth quarter of 2018.
Following the announcement, shares of Stryker inched up 0.9% to $171.76 at close. In the past year, the stock has rallied 19.6% compared with the industry’s 18.2% rise. The current level is also higher than the S&P 500 index’s increase of 16.2%.
The stock currently has a Zacks Rank #3 (Hold).
Recently, Stryker announced the buyout of K2M Group Holdings for $1.4 billion with a view to boost its Spine business. (Read More: Stryker to Acquire K2M Group, Fortify Spine Division)
How Will Stryker Gain?
California-based Invuity offers innovative products for minimally-invasive surgery, in which Stryker specializes. The combined leadership is thus likely to equip Stryker to ensure better patient outcomes.
Notably, this will boost the Neurotechnology & Spine division which includes both neurosurgical and neurovascular devices. In the last reported quarter, this segment accounted for 19.2% of total revenues. The segment also grew 12% organically.
Per a study by Transparency Market Research, the global surgical instruments market is estimated to register revenues worth $11.28 billion by the end of 2019. The market is likely to be dominated by Europe and North America geographies, which see robust demand for surgical instruments.
Inside Stryker’s Surgical Suite
Stryker offers a wide array of products across all three of its core units, viz, Orthopaedic, MedSurg and Neurotechnology & Spine.
Some of the major surgical products include AIM laparoscopes, AHTO Pump, CrossFlow Tubing, Fluid Safe fluid management system and Precision AC.
Stryker’s coveted Mako robotic-arm assisted surgery platform also deserves a mention here. Recently, the company launched the robotic-arm assisted total knee arthroplasty application for use with its Mako System.
In fact, in the last reported quarter, Stryker’s instruments revenues improved 12.6% at constant currency.
Want More From the MedTech Space?
A few better-ranked stocks from the broader medical space are athenahealth ATHN, Intuitive Surgical ISRG and Masimo Corporation MASI.
athenahealth has a long-term expected earnings growth rate of 17.6%. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Intuitive Surgical’s expected long-term earnings growth rate is 14.7%. The stock sports a Zacks Rank #2 (Buy).
Masimo’s long-term earnings growth rate is projected at 14.8%. The stock carries a Zacks Rank #2.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
athenahealth, Inc. (ATHN) : Free Stock Analysis Report
Masimo Corporation (MASI) : Free Stock Analysis Report
Intuitive Surgical, Inc. (ISRG) : Free Stock Analysis Report
Stryker Corporation (SYK) : Free Stock Analysis Report
To read this article on Zacks.com click here.
