Morgan Keegan analyst Jay Wald handed Abbott (NYSE:ABT) and Boston Scientific Corp. (NYSE:BSX) a set of matching downgrades this week, citing uncertainty about the market.
Wald downgraded both companies to "market perform" from "outperform" and lowered price targets for stocks.
"It appears that investors’ risk assessments are changing in the wake of the S&P downgrade, continued eurozone challenges, and continued weakness in and uncertainty about the U.S. economy," he wrote, adding that neither company offered any "relative upside" to investors any longer.
The downgrades came the day after industry giant Medtronic Inc. (NYSE:MDT) released its quarterly earnings report, which showed declines in sales for its spinal implants and defibrillators. While MDT shares gained 6 percent on new CEO Omar Ishrak’s efficiency mission, Wells Fargo analyst Larry Biegelsen warned that the plans would take time to produce "tangible benefits."
Wald reiterated his grade for Medtronic, which was already at "market perform," the Associated Press reported.
Boston Scientific’s shares this month dipped below $6 for the first time in almost a year. The Natick, Mass.-based medical device colossus has had a roller-coaster stock ride, with two upgrades and one downgrade from analysts in June.
Abbott’s “beat & raise” second quarter earnings report failed to impress Wall Street last month, despite the health care products giant reporting strong second-quarter sales and earnings figures — including a nearly 100 percent top-line surge for its coronary stents business.
The company boosted its diluted EPS guidance for the fully year to between $4.58 and $4.68, up from $4.54 to $4.64, excluding special items. That failed to impress The Street, where ABT shares were down about 1 percent to $52.40 in mid-day trading on July 20.
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