CR Bard: Expansion Plans On Track, Product Pipeline Strong

On Jul 4, we issued an updated research report on Murray Hill, NJ-based CR Bard Inc. (NYSE:BCR) – a global leader in the design, manufacture, packaging, distribution, and marketing of medical care devices. The company currently carries a Zacks Rank #2 (Buy).

Bard reported an impressive first quarter of 2016 driven by robust performance in international markets, extensive expenditure on product innovation and a diversified product portfolio. Notably, most of Bard‘s products are ‘single use’, that provides the company with a significant recurring revenue platform.

BARD C R INC Price and Consensus

BARD C R INC Price and Consensus | BARD C R INC Quote

We believe, the company’s continued investment in product development is a key catalyst. Bard’s growth strategy of planned investment in ‘complementary product’ acquisition has strengthened the company’s position and expanded its base in the broader medical space.

Meanwhile, the company has gained a competitive edge in the market with its new acquisitions. Bard made several acquisitions in the fields of urology, surgical hemostat, Aortic valvuloplasty products, drug-coated balloons and targeted temperature management.

Notably, amongst several other acquisitions, the takeover of Neomend has allowed Bard to expand its base into the lucrative $1 billion market of surgical specialties. In fact, the growing adoption of Lutonix Drug Coated Balloons is expected to bode well for Bard, as it has allowed the company to expand its base in the lucrative market of Drug coated balloons.

Additionally, the recent share buyback program worth $500 million will boost earnings in full-year 2016 and beyond.

However on the flip side, severe pricing pressure has been a major drag for Bard. The company is also poised for severe cut-throat competition, especially in the hernia fixation and peripheral stent businesses. Sluggish hospital spending environment and integration risks due to multiple acquisitions are added concerns over the long haul.

Key Picks

Better-ranked stocks in the broader medical sector include Derma Sciences Inc (NASDAQ:DSCI) , CONMED Corporation (NASDAQ:CNMD) and The Cooper Companies Inc (NYSE:COO) . Notably, Derma Sciences sports a Zacks Rank #1 (Strong Buy) while both CONMED Corporation and Cooper Companies carry a Zacks Rank #2 (Buy).