Boston Scientific's stock heads for record high as earnings shine and company offers upbeat guidance

By Ciara Linnane

Medical-tech company said a new therapy for cardiac arrhythmias launched mid-quarter helped drive sales growth

Boston Scientific Corp.'s stock rose 7% Wednesday to put it on track for a fresh record high after the medical-tech company beat analyst estimates for first-quarter earnings and offered upbeat guidance for the second quarter and full year.

The stock was last quoted at $73.81, which would be a record high if the gains hold through the close, based on data going back to May 19, 1992, according to Dow Jones Market Data. The stock is on pace for its biggest one-day percentage gain since Nov. 9, 2020, and has climbed for three straight days for a total gain of 9.6%.

Chief Executive Mike Mahoney said the numbers were boosted by the nearly 90 new products launched in 2023 and the initial U.S. launch of the company's Farapulse Pulsed Field Ablation System, a therapy for cardiac arrhythmias, in the quarter.

Electrophysiology sales rose 72% in the quarter and were up 85% in the U.S., mostly due to the mid-quarter launch of the Farapulse, he said.

Early feedback on the product "has been extremely positive, with rapid adoption from both RF and cryo users," Mahoney told analysts on the company's earnings call, according to a FactSet transcript. The executive was referring to technologies that use heat or cold to treat arrhythmias.

"This is the most transformational product that I've seen in my career with the company," he said in response to a question about the product.

The company is still investing in its commercial team in the U.S. and is seeing momentum in Europe, he said. In Asia, it expects Farapulse to take off in the fourth quarter of 2025.

The Marlborough, Mass.-based company (BSX) had net income of $495 million, or 33 cents a share, for the quarter, up from $300 million, or 21 cents a share, in the year-earlier period. Adjusted per-share earnings came to 56 cents, ahead of the FactSet consensus of 51 cents.

Sales rose to $3.856 billion from $3.389 billion, also ahead of the $3.684 billion FactSet consensus.

By segment, medical-surgery sales rose 10.3%, while cardiovascular sales rose 15.9%. By geography, U.S. sales were up 12.7%; Europe, Middle East and Africa sales rose 12.7%; Asia-Pacific sales rose 18.3%; Latin America and Canada sales rose 17.9%; and emerging-markets sales rose 22.6%.

The numbers were aided by "healthy procedural demand," he said.

Medical-device makers have benefited as patients are again having procedures such as hip and knee replacements that they delayed during the pandemic.

Read also: Medical-device makers' stocks jump as procedures keep going strong

Urology sales grew 10%, with double-digit growth in stone management and prosthetic urology, or the use of implanted devices to treat ailments such as stress urinary incontinence and erectile dysfunction, Mahoney said.

Rezum, the water therapy used to treat an enlarged prostate, performed well in the U.S. and internationally and has secured reimbursement status in France, he said.

Endoscopy sales grew 12%, driven by Axios stents and single-use imaging products. Neuromodulation sales, or technology that acts directly on nerves to manage pain, rose 10%. The overall pain franchise grew in the low double-digits, he said.

Peripheral intervention, a heart treatment, saw sales rise 16%, and interventional oncology grew by double-digits, he said.

The company expects full-year sales to rise 11% to 13% and for adjusted EPS to range from $2.29 to $2.34. The FactSet consensus is for sales growth of 9.5% and EPS of $2.26.

For the second quarter, it expects sales to rise 10.5% to 12.5% and for adjusted EPS of 57 cents to 59 cents. FactSet is expecting second-quarter sales to rise 9.3% and EPS of 56 cents.

The stock has gained 27% in the year to date, while the S&P 500 has gained 6%.

-Ciara Linnane

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04-24-24 1130ET

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