St Jude Medical Inc. (STJ): Today's Featured Health Care Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

St Jude Medical ( STJ) pushed the Health Care sector lower today making it today's featured Health Care laggard. The sector as a whole closed the day up 0.7%. By the end of trading, St Jude Medical fell $4.34 (-12.2%) to $31.37 on heavy volume. Throughout the day, 26.3 million shares of St Jude Medical exchanged hands as compared to its average daily volume of 2.9 million shares. The stock ranged in price between $30.25-$34 after having opened the day at $33.75 as compared to the previous trading day's close of $35.71. Other companies within the Health Care sector that declined today were: Dynatronics Corporation ( DYNT), down 11.1%, Arrhythmia Research Technology ( HRT), down 9.1%, Supernus Pharmaceuticals ( SUPN), down 8.9%, and Heartware International ( HTWR), down 8.8%.
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St. Jude Medical, Inc. develops, manufactures, and distributes cardiovascular and implantable neurostimulation medical devices worldwide. It operates in four segments: Cardiac Rhythm Management, Cardiovascular, Atrial Fibrillation, and Neuromodulation. St Jude Medical has a market cap of $11.02 billion and is part of the health services industry. The company has a P/E ratio of 15, below the S&P 500 P/E ratio of 17.7. Shares are up 4.2% year to date as of the close of trading on Tuesday. Currently there are 15 analysts that rate St Jude Medical a buy, no analysts rate it a sell, and 11 rate it a hold.

TheStreet Ratings rates St Jude Medical as a buy. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

On the positive front, CombiMatrix Corporation ( CBMX), up 22%, Sequenom ( SQNM), up 15.2%, Vivus ( VVUS), up 13.3%, and BG Medicine ( BGMD), up 11.5%, were all gainers within the health care sector with Illumina ( ILMN) being today's featured health care sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the health care sector could consider Health Care Select Sector SPDR ( XLV) while those bearish on the health care sector could consider ProShares Ultra Short Health Care ( RXD).

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