Looking to get back into the stock market? A few large medical device makers might be among your best bets, according to analyst Christopher Titus of Zacks Investment Research.
Writing that medical device stocks have roughly tracked with the overall market since the economic downturn kicked off in earnest late last year (check out the MassDevice Index to see how local companies are faring), Titus recommends investors focus on firms that make “life-sustaining” products that patients simply can’t do without.
“These should remain insulated from the current economic crisis as target patients are unable to forego procedures,” he wrote.
They include previous Zacks faves Boston Scientific, St. Jude Medical, Baxter International, Becton Dickinson and C.R. Bard, all of which beat the general market’s roughly 30 percent decline since Sept. 1, 2008, according to Titus.
Investors should look to larger companies with enough liquidity to ride out the economy and take advantage of bargain-basement valuations for acquisition. Firms with a wide portfolio of smaller-ticket items are better positioned both to avoid the downturn in large capital spending and to take advantage of purchasers consolidating their suppliers, he added.
Specifically, Titus counseled taking a closer look at cardiovascular device and surgical equipment, blood-related product and associated consumables makers, including the firms named above and Braintree’s Haemonetics Corp.