5 reasons you should feel good about medtech companies in 2023
Updated: Feb 3
“Macroeconomic headwinds” is a phrase repeated a lot these days, but a string of positive medtech company earnings reports this week should cheer medical device industry insiders.
The medical device industry may once again prove that it’s an economically resilient space.
“While 2022 brought its share of supply chain and inflationary pressures, directionally, many companies note easing within the supply chain, lessening inflationary impacts, healthy capital demand, and improving procedural recovery. We think as these dynamics take shape through 2023, MedTech’s outlook and subsequent sector performance in the market will improve,” BTIG analyst Ryan Zimmerman told MassDevice via email.
Investors are finally looking past a lot of the macro challenges, according to Mike Matson, a senior research analyst at Needham & Co.
“While the medtech industry isn’t out of the woods yet, things have started to get better: Supply chains are improving, inflation is easing, the dollar has weakened, the Fed’s interest rate increases are slowing, and China has ended the COVID lockdowns. And the whole stock market has shifted from viewing a recession as a foregone conclusion to an increased likelihood of a soft landing,” Matson said.
Granted, things aren’t entirely positive. Philips is laying off thousands of additional workers as it grapples with a serious respiratory devices recall. Plus, Johnson & Johnson, which has the second-largest medical device business in the world, reported mixed Q4 results last week.
Here are five medtech companies that overcame challenges to report especially positive earnings this week:
“We expect continued positive sales momentum in 2023 and for adjusted earnings to gradually improve over the course of the year,” said CEO Kevin Lobo. He also had a timeline of future application launches for the ortho device giant’s popular Mako robotic surgery system.
Revenue from the women’s health and diagnostics company’s COVID-19 assays may be in decline. Plus, there are supply chain challenges related to semiconductor chips in its Breast Health business. Despite the hurdles, sales growth is strong for Hologic’s non-COVID business,
Hologic is upping its guidance. According to CEO Steve MacMillan, Hologic is “highlighting the confidence we have in our businesses despite an uncertain macro environment.”
“Consistent, durable performance in our base business reflects our team’s relentless focus on delivering category-leading products and transformative solutions that are helping our customers deliver quality and more cost-effective care to patients around the world,” said CEO Tom Polen.
CEO Michael Mussallem, who announced plans to step down this year, said the healthcare environment “is gradually improving.”
Truist analysts described the report as a “solid finish” to the year for the medtech company, which has a strong cardiology focus.