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Valued at a market cap of $39.3 billion, Chicago, Illinois-based GE HealthCare Technologies Inc. (GEHC) specializes in medical imaging, patient-monitoring products, and diagnostic agents. It delivers advanced solutions for patient diagnosis, treatment, and monitoring worldwide by operating through segments in Imaging; Ultrasound; Patient Care Solutions; and Pharmaceutical Diagnostics.
Shares of the medical technology company have underperformed the broader market over the past 52 weeks. GEHC has surged 22.8% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 36.8%. In 2024, shares of GEHC are up 11.2%, compared to SPX’s 25.7% gain on a YTD basis.
However, focusing more closely, GE HealthCare has outpaced the Health Care Select Sector SPDR Fund’s (XLV) 17.2% gain over the past 52 weeks and a 10.1% YTD return.
GEHC shares rose 2.3% on Oct. 30 as the company reported a Q3 profit of $1.14 per share, beating the $1.06 estimate, supported by strong U.S. demand across all segments. The company also posted revenue of $4.9 billion in the period, which met Street forecasts. Strong mid-single-digit growth in U.S. sales and solid demand in Pharmaceutical Diagnostics helped counter weaker performance in China. Additionally, the company raised the low end of its 2024 adjusted EPS guidance to $4.25, signaling confidence in year-end performance.
For the current fiscal year, ending in December, analysts expect GEHC’s EPS to grow 9.2% year-over-year to $4.29. The company's earnings surprise history is promising. It beat or met the consensus estimates in the last four quarters.
Among the 18 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on 11 “Strong Buy” ratings, six “Holds,” and one “Strong Sell.”
This configuration is slightly more bullish than three months ago, with 10 “Strong Buy” ratings on the stock.
On Oct. 31, Piper Sandler raised its price target for GE HealthCare to $97 and maintained an “Overweight” rating after Q3 results showed revenue and EPS slightly above expectations. While U.S. growth was strong, delayed stimulus in China may affect early 2025 performance.
As of writing, GEHC is trading below the mean price target of $97. The Street-high price target of $110, implies a potential upside of nearly 28% from the current price levels.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
