Can Boston Scientific's (BSX) Steady Growth Aid Q1 Earnings?

Boston Scientific Corporation BSX is scheduled to report first-quarter 2019 results on Apr 24, before the opening bell.

In the last reported quarter, the company’s earnings per share beat the Zacks Consensus Estimate by 5.41%. Moreover, it delivered positive earnings surprises in each of the trailing four quarters, the average being 8.85%.

Let’s see, how things are shaping up prior to this announcement.

Key Catalysts

Alike the prior reported quarter, we are upbeat about strong contributions from Boston Scientific’s Cardiovascular business group, which comprises Interventional Cardiology (IC) and Peripheral Interventions (PI). In the last reported quarter, the company generated around 38% of its total revenues from this highest revenue generating segment and registered 8.6% growth on an operational basis.

We are optimistic about the IC business that will help the company maintain impressive global growth, courtesy of an innovative portfolio and robust commercial teams. Complex PCI (percutaneouscoronary intervention) products within IC are growing strongly on the back of successful global expansion efforts. The recent U.S. launch of Eluvia has been a growth driver within this segment. This apart, the company is showing a solid uptick in Ranger DCB and interventional oncology. Meanwhile, the company’s integrations of both VENITI and BTG should ring in the desirable synergies post closure of the acquisitions.  

Within IC, the company is demonstrating continued strength in structural heart with WATCHMAN, ACURATE, SENTINEL as well as in both complex PCI (percutaneous coronary intervention) and PCI guidance portfolios. We expect these upsides to contribute to the company’s top line in the upcoming quarterly results.

Boston Scientific Corporation Price and EPS Surprise

Boston Scientific Corporation Price and EPS Surprise | Boston Scientific Corporation Quote

More specifically, the company is highly optimistic about a promising start to 2019 within its IC and PI business, banking on its plans to launch a number of products. In this regard, the company received a CE Mark in March and initiated a limited market release of the next-generation WATCHMAN FLX Left Atrial Appendage Closure (LAAC) Device in Europe.

This apart, the company expects to see a consistent growth momentum in WATCHMAN this year, riding on the growing adoption by its existing customers and geographic expansions wherein both Japan and China represent a significant opportunity of strength.

The Zacks Consensus Estimate for IC revenues is pegged at $689 million, indicating an increase of 6.8% from the year-ago reported figure.

In recent quarters, the PI business steadily demonstrated a solid uptrend across segments like peripheral arterial disease, venous and interventional oncology. In the last reported quarter, the company commenced the launch of Eluvia in the United States. Per Boston Scientific, Eluvia has a substantial market potential owing to the large addressable patient population, a differentiated, sustained-release technology and the superior clinical outcomes with reduced need for reintervention. We believe, this launch will be accretive to the company’s first-quarter results.

The Zacks Consensus Estimate for first-quarter PI revenues stands at $305 million, suggesting a 5.9% rise from the prior-year reported figure.

Other Factors at Play

Among the other segments, MedSurg is estimated to demonstrate a stable performance led by endoscopy. Urology and Pelvic Health are also projected to surpass the market levels, driven by investment strategies in the key international geographies.

Within endoscopy, the company is expected to display sturdy results, driven by a promising performance within itshemostasis franchise in infection prevention and strong pathology.

Urology and Pelvic Health business should also continue to maintain its growth momentum on the back of a robust global performance. 

Boston Scientific’s recent acquisitions added several products (though many are under development) with immense potential to its portfolio. The buyouts of NxThera and nVision in Urology and Pelvic Health, EmCision in Endoscopy and Securus in EP deserve special mention.