In a report released today, Julien Ouaddour from Bank of America Securities reiterated a Buy rating on Smith & Nephew (SN – Research Report), with a price target of p1,320.00.
Julien Ouaddour has given his Buy rating due to a combination of factors that indicate a positive outlook for Smith & Nephew. The company has shown continuous improvement in its US Reconstruction segment, particularly in knee and hip replacements, which are expected to drive operating leverage and enhance margins. Management’s confidence in achieving a 19-20% margin range is supported by strategic initiatives in China, cost savings, and operational efficiencies.
Additionally, the company’s ability to meet and potentially exceed market growth rates by 2025, coupled with favorable risk/reward dynamics, supports the Buy rating. The recent increase in earnings per share estimates and the upward revision of the price objective further reflect the positive sentiment. Despite challenges in the Chinese market, Smith & Nephew’s strategic focus on orthopedic turnaround and shareholder value creation underpins the optimistic outlook.
Ouaddour covers the Healthcare sector, focusing on stocks such as Koninklijke Philips, Alcon, and Demant. According to TipRanks, Ouaddour has an average return of 26.4% and an 82.35% success rate on recommended stocks.
In another report released on February 28, Morgan Stanley also maintained a Buy rating on the stock with a p1,355.00 price target.