No near-term rally expected for Medtech as COVID-19 concerns persist- JPM

AtriCure

18/01/2022 11:51

** Brokerage J.P. Morgan says COVID-19 concerns persist into
Q4 for medical technology companies, as the Omicron variant
surge disrupts elective procedures and triggers staffing
shortages at hospitals
    ** "We don't think 4Q earnings with the upcoming 2022 guides
will be the clearing event for MedTech to rally and fund flows
to re-engage in the sector, but think if we could progress into
mid-year without another variant and stabilizing trends, there's
a real potential for the sector to rerate" says brokerage
    ** JPM says 2022 outlook is likely to be a key focus area
for investors and comments from the companies at brokerage's
recent annual conference; it expects them to issue full-year
guidance roughly in line with the Street, assuming an improving
Q2 and a more normal back half of the year
    ** Brokerage says it favors those companies with diverse
revenue drivers which are less exposed to COVID-19 impact as
well as with data or new product catalysts in 2022
    ** Reiterates Boston Scientific Corp  BSX.N  and Dexcom Inc
 DXCM.  as its top large cap picks, and Inspire Medical Systems
 INSP.N  and AtriCure  ATRC.N  as its top small- and mid-cap
picks
    ** Believes Abbott Laboratories  ABT.N  and Becton Dickinson
and Co  BDX.N  are best positioned to beat Street top-line
estimates in 2022, boosted by COVID-19 testing demand

 (Reporting by Amruta Khandekar)
 ((Amruta.Khandekar@thomsonreuters.com;))