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As one of the ugliest names in the technical charts, Boston Scientific (BSX) has become quite toxic for shareholders. Since the beginning of the year, BSX stock has plunged more than 37%, practically erasing a mega-rally that began around late 2023. It’s also ranked as a 100% Strong Sell (unsurprisingly) by the Barchart Technical Opinion indicator. Common wisdom would suggest avoiding catching falling knives. However, a contrarian narrative could be lurking in the shadows.
At a glance, a large portion of the fallout can be attributed to Boston Scientific announcing the acquisition of Penumbra, a global healthcare company focused on innovative medical devices for neurovascular and peripheral vascular conditions. Fundamentally, the decision to buy the medical device specialist was a strategic intent to fill a massive portfolio gap and re-enter high-growth markets where Boston Scientific was previously underweight.
