Boston Scientific has strong prospects across the board, including in an area where a rival is trying to take market share, according to Needham. Analyst Mike Matson upgraded Boston Scientific to buy from hold, saying in a note to clients that a medical device produced by the company should remain a strong seller despite new competition from Abbott Laboratories. The device, which is called watchman, can be used to reduce stroke risk in patients with irregular heartbeats. “BSX is now reporting WATCHMAN sales on a quarterly basis. While management has stated that this is due to a reorganization of its reporting segments rather than a sign of bullishness, we find it hard to believe that they would have chosen to do this if they were concerned about the impact of Abbott’s (ABT – Not Rated) Amulet launch, “Matson wrote. And even if Abbott product gains market share, Boston Scientific should be able to offset that with strength elsewhere, according to Needham. “We performed a sensitivity analysis of BSX’s overall revenue growth to WATCHMAN’s growth, and we now believe that 1) BSX could sustain high single digit organic growth even assuming a moderate slowdown in WATCHMAN growth; and 2) BSX should be able to at least partially offset slower WATCHMAN growth with upside from other products, “Matson wrote. Additionally, Needham said that Boston Scientific could be a takeover target if merger and acquisition activity in health care ramps up, which would likely provide upside for shareholders. Needham set a price target of $ 48 per share for Boston Scientific. That is nearly 20% above where the stock closed Thursday. – CNBC’s Michael Bloom contributed to this report.
