Boston, MA 06/12/2014 (wallstreetpr) – Investment advisor Goldman Sachs Group Inc. (NYSE:GS) expects that global medical technology company, Becton, Dickinson and Co. (NYSE:BDX)’s growth is likely to be balanced between discrete new product launches and the emerging markets that will be offset by diagnostic systems business in the U.S. due to ongoing pressures.
Growth Potential
The brokerage believes that these factors would help the medical technology company to deliver the current revenue uptick in the material safety data percentage or MSD%. However, the investment advisor does not see any upside to this for the near term. The company’s chairman and CEO Vince Forlenza and CFO Christopher Reidy presented at the Goldman Sachs Medical Technology Conference.
Earlier, Becton, Dickinson and Co. indicated that a favorable macro environment will provide upside opportunities and that it was not contemplated while providing outlook. Now, with half of the current year gone, it expects volumes of the U.S. patients after a weak first quarter blaming an early flu season and bad weather.
The company expected some pick-up nationally in physician office visits. This apart, global market seemed to have turned somewhat better than predicted due to research and Southern European spending.
Emerging Markets
There has been no impact on healthcare spending in the emerging markets despite its GDP witnessing a slower growth since governments are not expected to cut down their spending and instead expand access and spending. The brokerage felt that Becton, Dickson and Co. was able to boost its growth pace in emerging markets to 12 – 14% from 10 – 12% and the company believes that it could sustain it.
This is a positive factor for the company’s shares. Goldman Sachs analyst believes that emerging markets would be able to contribute 50 – 60% of the total top line results.
Margins
The brokerage expects Goldman Sachs Group Inc (NYSE:GS) to improve quality earnings by EBIT margin expansion following a period of time when its earnings were mostly dictated by financial leverage. Becton, Dickinson and Co is predicted to get the booster from mix of new products, direct cost initiatives, and natural leverage for profitability improvement.
