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SYK – Markets have bullish expectations for SYK, but management may be concerned about their acquisitions, regulation, and EPS

  • Stryker Corporation (SYK:USA) currently trades near historical highs relative to UAFRS-based (Uniform) Earnings, with a 31.8x Uniform P/E. At these levels, markets are pricing fairly bullish expectations for the firm, but management may be concerned about their acquisitions, international regulation, and EPS guidance
  • Specifically, management may lack confidence in their ability to continue sourcing profitable acquisition opportunities, and they may be concerned about continued regulatory headwinds in their international Shoulder business. Furthermore, they may lack confidence in their ability to sustain recent organic sales growth, Orthopedics growth, and Mako robot demand. Finally, they may be concerned about the sustainability of demand for their NOVADAQ product lines, and they may lack confidence in their ability to meet their full year sales and diluted EPS guidance.