Boston Scientific Rises as CEO Eases Worry on Growth Prospectsby
CEO forecasts double-digit earnings per share growth for 2017
Filing for U.S. approval of Lotus Edge heart valve on track
Boston Scientific Corp. shares rose after Chief Executive Officer Mike Mahoney forecast earnings and revenue growth for 2017, easing investor concerns amid swirling questions about U.S. insurance coverage and the strength of the global economy.
Shares of the medical-device maker rose 4.8 percent to $23.25 at 12:34 p.m. in New York, after increasing as much as 4.9 percent, the most in nine months.
Mahoney, speaking at the J.P. Morgan Healthcare Conference in San Francisco, said revenue growth from existing businesses is accelerating as the company moves into higher-margin and faster-growing areas. Sales of structural heart products, including the Watchman device used to avert strokes, will soar to $300 million in 2017, he said. While the company is focused on improving its operating profit margin, it remains lower than its competitors’, he said, leaving room to cut more cuts.
The device maker has identified the cause of the problem that led it to halt European implants of its Lotus Edge heart valve and has a solution in place, the CEO also said. The issue with the locking system, which emerged during procedures on six patients, has a relatively simple fix and never put patients in danger, he said. The company still plans to file for U.S. approval in the second quarter, with clearance expected by the end of the year, he said.
For this year, the CEO expects “double-digit” growth for earnings per share, excluding some items. Analysts anticipate a 14 percent gain, on average.