Why Stryker Stock Popped Today

• Raymond James expert Jayson Bedford upgrades Stryker banal to outperform today.

• The aesculapian devices banal has grown income astatine 10% oregon amended for 5 consecutive years.

• 10 stocks we similar amended than Stryker ›

Stryker (NYSE: SYK) banal is hopping Tuesday morning, up 3.2% done 11:45 a.m. ET, aft Raymond James expert Jayson Bedford called the institution "one of the highest prime stocks successful ample headdress MedTech" -- and upgraded it.

Bedford predicts Stryker banal volition deed $418 wrong a year, and has upgraded the banal to "outperform" (i.e., buy).

As Bedford explains, Stryker wrapped up its "fifth consecutive twelvemonth of 10%-plus integrated gross maturation successful '25," yet "the banal underperformed past twelvemonth arsenic the NTM P/E aggregate compressed by ~3 turns."

(Translation: The banal utilized to merchantability for much than 26 times guardant earnings, but close present it's selling for person to 23x earnings.)

Bedford thinks this simplification successful the net aggregate is unjustified, fixed Stryker's gains successful marketplace share, its "double-digit maturation profile, and the likelihood for upside to estimates."

I disagree.

Don't get maine incorrect -- Stryker's been doing a decent occupation of increasing its profits, and astir analysts expect its net volition proceed to turn 10% oregon amended implicit the adjacent 5 years. However, valued connected GAAP profits, Stryker banal costs a hefty 46 times trailing earnings, and to me, that seems a much than generous terms to wage for simply 10% net growth.

Indeed, 46 times net for 10% maturation really seems to maine a spot excessive, and I fig myself among the investors (with whom Bedford disagrees) who deliberation that Stryker's net aggregate should come down a bit.

Stryker banal is overpriced. Selling it is the close prime to make.

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