Reasons to Retain GE HealthCare Stock in Your Portfolio Now

GE HealthCare Technologies, Inc. GEHC is well-poised for growth in the coming quarters, courtesy of its continued focus on innovations. The optimism, led by strong second-quarter fiscal 2024 performance and acquisitions, is expected to contribute further. However, geopolitical tensions and stiff competition are concerning.This Zacks Rank #3 (Hold) company’s shares have risen 4.7% in the year-to-date period compared with 12.6% growth of the industry. The S&P 500 composite has risen 28.3% during the said time frame.The renowned provider of medical technology, pharmaceutical diagnostics and digital solutions has a market capitalization of $36.68 billion. The company projects 6.3% growth for the next five years and expects to maintain its strong performance in the future. It delivered a trailing four-quarter average earnings surprise of 4.97%.Image Source: Zacks Investment ResearchFactors Favoring GEHC’s GrowthMacro Tailwinds Boost Performance: GE HealthCare’s strong growth across all its segments and regions is primarily being driven by macro tailwinds, including the easing of supply-chain challenges. The trend is likely to continue in 2024. Moreover, robust demand and improved pricing of its products look promising. Key products driving revenue growth are MR, MI, CT, general imaging and women's health products. The company expects organic revenue growth of 1-2% in 2024. It had an order backlog worth $19.6 billion at the end of September 2024.Innovations Supporting Growth: GE HealthCare’s commitment to drive innovation has allowed it to achieve continuous, significant improvements. Earlier this month, the company unveiled Aurora, a new dual-head single-photon emission computed tomography/ computed tomography (SPECT/CT) designed to help clinicians visualize better and expand the range of CT procedures typically available in hybrid systems. GEHC also launched Sonic DL for 3D in the same month to further boost the company’s imaging portfolio.Last month, GEHC also announced the 510(k) submission to the FDA for CleaRecon DL, a deep-learning technology. The same month, it also unveiled a new Pristina Via mammography system, with a suite of advanced tools that balance the demands of diagnostic accuracy and workflows.In November, it announced additional clinical applications of the OEC 3D mobile CBCT C-arm portfolio, which enable precise and efficient imaging during endoscopic bronchoscopy. The same month, GEHC received FDA clearance for its SIGNA MAGNUS, a 3.0T high-performance, head-only magnetic resonance imaging (MRI) scanner.Acquisitions & Partnerships: GE HealthCare has several partnership agreements that help attract long-term customers for its products and services. GEHC is also focused on acquiring companies that will help it grow.Last month, the company announced its collaboration with Melbourne, Australia-based Peter MacCallum Cancer Centre. The tie-up should enable GEHC to further develop and explore the clinical and research possibilities of its total body positron emission tomography/computed tomography (PET/CT) technology designed with a 128 cm, ultra-high sensitivity detector. The same month, GEHC inked another collaboration with DeepHealth, a subsidiary of RadNet, to develop SmartTechnology for revolutionizing imaging through artificial intelligence (AI).In October, GEHC completed the acquisition of Intelligent Ultrasound Group PLC’s clinical AI software business for $51 million, a move aimed at reshaping its ultrasound portfolio by improving clinical workflows and advancing medical imaging.Strong Q2 Results: GE HealthCare exited third-quarter 2024 with decent results, wherein earnings and revenues improved year over year. Total company orders increased 1% organically year over year. Excluding China, sales as well as orders grew in the mid-single digit percentage points. The company witnessed continued strength in its Pharmaceutical Diagnostics business, with revenues increasing 6% from the year-ago quarter’s figure.GEHC’s net income margin was 9.7%, up 190 basis points from the prior-year period due to productivity and pricing benefits.Factors That May Offset the Gains for GEHCStiff Competition: The presence of a large number of players has made the medical devices market highly competitive. The company faces competition from similar global participants and regional participants, which may vary by segment and product line.The primary global competitors in the industries it serves are Siemens Healthineers, Philips Healthcare, Canon and United Imaging. In the Pharmaceutical Diagnostics business segment, it primarily competes with Bayer, Bracco, Guerbet, Lantheus and Curium.Geopolitical Tensions: GE Healthcare’s business faces risks from the ongoing war between Russia and Ukraine, which has led to sanctions impacting business. The U.S. government and the European Union have implemented expanded measures since May 2023 to provide specified medical equipment and spare parts to customers in Russia.The implementation of these measures has affected GEHC’s ability to supply customers in Russia. In the first nine months of 2024, the company generated revenues of $243 million from Russia and Ukraine (combined), representing almost 5% of total sales.Estimate TrendGEHC is witnessing a positive estimate revision trend for fiscal 2025. In the past 30 days, the Zacks Consensus Estimate for earnings improved 1 cent to $4.30 per share.The Zacks Consensus Estimate for fourth-quarter fiscal 2024 revenues is pegged at $5.34 billion, indicating a 2.5% improvement from the year-ago quarter’s reported number. The consensus mark for EPS was pinned at $1.26, implying an improvement of 6.8%.GE HealthCare Technologies Inc. Price GE HealthCare Technologies Inc. price | GE HealthCare Technologies Inc. QuoteStocks to ConsiderSome better-ranked stocks in the broader medical space are Masimo MASI, Accuray ARAY and Abbott Laboratories ABT.Masimo, sporting a Zacks Rank #1 (Strong Buy) at present, has an estimated growth rate of 11.8% for 2025. You can see the complete list of today’s Zacks #1 Rank stocks here.MASI’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 17.10%. Its shares have risen 51.2% compared with the industry’s 5.2% growth year to date.Accuray, carrying a Zacks Rank #2 (Buy) at present, has an estimated growth rate of 1200% for 2025. Its earnings missed estimates in three of the trailing four quarters and met in one, delivering an average negative surprise of 141.97%.ARAY’s shares have lost 31.1% against the industry’s 5.2% growth year to date.Abbott, carrying a Zacks Rank of 2 at present, has an estimated earnings growth rate of 10% for 2025. It delivered a trailing four-quarter average earnings surprise of 1.64%.ABT’s shares have risen 2.3% year to date compared with the industry’s 11.5% growth.Free Today: Profiting from The Future’s Brightest Energy SourceThe demand for electricity is growing exponentially. At the same time, we’re working to reduce our dependence on fossil fuels like oil and natural gas. Nuclear energy is an ideal replacement.Leaders from the US and 21 other countries recently committed to TRIPLING the world’s nuclear energy capacities. This aggressive transition could mean tremendous profits for nuclear-related stocks – and investors who get in on the action early enough.Our urgent report, Atomic Opportunity: Nuclear Energy's Comeback, explores the key players and technologies driving this opportunity, including 3 standout stocks poised to benefit the most.Download Atomic Opportunity: Nuclear Energy's Comeback free today.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Abbott Laboratories (ABT): Free Stock Analysis Report Accuray Incorporated (ARAY): Free Stock Analysis Report Masimo Corporation (MASI): Free Stock Analysis Report GE HealthCare Technologies Inc. (GEHC): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks