Morgan Stanley analysts upgraded Stryker (NYSE:SYK) from Equalweight to Overweight, raising their price target from $370 to $445. The decision was based on favorable survey data and encouraging trends in orthopedic demand and capital expenditure.
The analysts highlighted findings from a hospital survey that suggested positive momentum for Stryker heading into 2025. Stryker’s Mako robotic system remained a leader in the orthopedic robotics market, showing slight share growth, increasing to 37% from 34% in a prior survey. A strong 68% of respondents indicated plans to purchase the Mako system, demonstrating consistent interest.
Large-joint orthopedic volumes were reported to be exceeding expectations in the second half of 2024, with 24% of respondents noting volumes above forecasts compared to only 7% indicating they were below. This trend aligned with Stryker management’s commentary on rising demand.
Additionally, survey respondents pointed to a stable capital expenditure outlook, projecting a 3.5% increase in 2025, which closely matched the 4.0% growth reported in 2024. This consistency in spending is expected to benefit Stryker’s performance as the company capitalizes on these favorable market dynamics.