Opinions
Jim Cramer - Mad Money
Becton Dickinson
BDX-N
BUY
May 02, 2025
Stock price when the opinion was issued
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Still really likes it. Major issue was surgeries on hold during Covid. Revenues declined, now returning to growth. Free cashflow yield ~4.5%. Earnings growth should return to double digits by end of 2024 and into the next couple of years. Unique. Compelling value.
With a market cap of over $60 billion it is the largest player in the medical disposables sector with 25% market share. Growth stalled for two years during COVID but is accelerating now. Its profits are solid so there is lots of room for acquisitions and a start to buying back shares. Trades at 17X earnings and there should be double digit earnings growth ahead. Can be somewhat volatile. Buy 16 Hold 2 Sell 0
(Analysts’ price target is $281.00)90% of their products are disposable medical supplies. Problem was that during Covid, there were fewer operations, so sales fell and are slowing catching up--8-10% growth annually in the next few years, he thinks. Stock is cheap now, but the stock has done nothing for him. Has excellent prospects.
They just reported a disappointing quarter, plunging shares 18%. Many are giving up on it, but it's a buying opportunity. For decades, this was a reliable growth stock, but in the past 5 years have been sideways. They reported beats and raises last year. They sold their life sciences division to unlock value, a smart move. But at the same time, they issued mixed guidance, including slightly lower earnings due to tariffs; they said they would have made their guidance if not for the tariffs. Trades at a low 12x this year's estimates and have bought back many shares already this year.