Investors are closely watching April 2, the long-anticipated “Liberation Day,” which has finally arrived. Financial markets are already getting jittery. Trump’s latest move to reshape trade policies by imposing a sweeping new round of tariffs (to be announced in just a few hours) may lead to a recession, as per many market watchers. Goldman Sachs recently raised its recession forecast from 20% to 35%, citing concerns that these tariffs could slow down business activity, drive up consumer prices and weaken economic confidence. With unemployment still low but consumer sentiment faltering, an economic downturn appears more imminent than before.
Economists are apprehensive that these tariffs could trigger negative repercussions, from increased costs for businesses that rely on imported goods to a slowdown in hiring and wage growth. Even before the tariffs take full effect, Wall Street firms have begun lowering their GDP growth projections, reflecting fears of an economic contraction.
At a time when market volatility is nearing its peak, it is prudent for investors to focus on long-term stability rather than short-term gains. The medical device industry has historically been a happy hunting ground for investors during periods of market upheaval. Despite facing short-term headwinds such as tariffs, healthcare labor supply issues and persistent cost escalation, the long-term outlook for medical device stocks remains highly promising. As we navigate through 2025, certain companies, such as Masimo MASI, Boston Scientific BSX, and Hims & Hers Health HIMS, stand out for their ability to counter these challenges while maintaining strong financial performance and market leadership.
Medical Device Stocks: A Safe Bet
Over the past couple of years, advancements in AI and predictive analytics have rapidly revolutionized the Medical device industry, driving innovation in diagnostics, patient monitoring and personalized treatment. AI-powered algorithms are enabling medical devices to analyze vast datasets in real time, providing accurate predictions and actionable insights for clinicians. Predictive analytics enhances device performance by identifying potential failures and optimizing maintenance schedules, ensuring reliability and reducing costs. In patient care, AI-integrated devices are advancing early disease detection and risk assessment, leading to improved outcomes.
In 2025, the rapid adoption of generative Artificial Intelligence (genAI) and digital therapeutics is expected to take this industry by storm. GenAI has already started to showcase its proficiency across a range of healthcare fields, from administrative tasks to critical areas, including clinical trials. Global AI in the healthcare market is currently projected to witness a CAGR of 38.5% from 2024 to 2030.
Here, we highlight three medical device companies that have not only outperformed the market so far in 2025 but also possess solid growth prospects for the rest of the year.
Our Picks
Masimo: This non-invasive patient monitoring systems maker is gaining from focused research and development (R&D) efforts. Masimo’s core measurement technologies include its breakthrough Measure-through Motion and Low Perfusion pulse oximetry (Masimo SET) powered-devices, from hospital bedside monitors like Root to portable solutions such as Radius PPG, Radius VSM and the Masimo SafetyNet remote patient surveillance system. Masimo is also advancing wearables, partnering with Qualcomm and Google to integrate its biosensing tech into Wear OS smartwatches.
MASI shares have risen 1.4% year to date, outperforming the broader market and the benchmark’s 4.5% and 4.8% drop, respectively. Despite its outperformance, Masimo trades nearly in line with the sector and is currently trading at 30.81X forward 12-month earnings. This Zacks Rank #1 (Strong Buy) stock trades 19.6% below its average Zacks price target. For 2025, the company is expected to report earnings growth of 20%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Share Price Comparison: MASI
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Boston Scientific: Despite macroeconomic concerns and related cost inflation, this medical device stalwart is seeing strength across target markets. Strong worldwide demand for its MedSurg and Cardiovascular lines, traction in the United States and outside for its next-generation WATCHMAN FLX and FLX Pro, as well as contributions from accretive acquisitions, are important drivers.
Boston Scientific’s Pain and Brain franchisees are expected to gain solid traction in 2025, banking on the strong execution of core growth strategies. The Electrophysiology arm continues to gain momentum on the sustained adoption of FARAPULSE PFA. The 2025 guidance indicates strong organic growth over 2024, building confidence in the stock.
BSX shares have risen 13.3% year to date, outperforming the broader industry’s 7.3% rise. This Zacks Rank #2 (Buy) stock trades 17.4% below its average Zacks price target. For 2025, the company is expected to report earnings growth of 13.6%.
Share Price Comparison: BSX
Zacks Investment Research
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Hims & Hers Health: This consumer-centric health and wellness platform addresses a vast unmet healthcare market, leveraging a $360 million U.S. total addressable market across specialties like mental health, weight loss and dermatology. Hims & Hers Health’s personalized product offerings drive subscriber growth, with 2 million plus subscribers contributing to rising recurring revenues. Targeting $100 million from new categories by 2025, Hims & Hers Health invests in GLP-1 weight-loss solutions, advanced tech and compounding pharmacies to increase scale.
HIMS shares have surged 28.4% year to date, outperforming the broader industry’s 5.3% gain. This Zacks Rank #2 stock trades 44.6% below its average Zacks price target. For 2025, the company is expected to report earnings growth of 133.3%.
Share Price Comparison: HIMS
Zacks Investment Research
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