Editors' pick: Originally published Monday, Feb. 8.
In this otherwise grim market, one industry that's poised to break through the shackles of the bears is the medical device industry, which was recently buoyed by news of the two-year suspension of the special tax on medical devices.
According to the Congressional Budget Office, this tax suspension could translate to savings to the tune of $5 billion for the medical device industry.
Taking a cue from this development, we've rounded up six top-quality stocks in the medical device industry that can take advantage of the tax relief and give your portfolio a boost. They're among a group of promising health services stocks that are poised to beat the market.MDT data by YCharts
Medtronic plc (MDT)
The Ireland-based developer, manufacturer, and marketer of medical devices is one of the biggest beneficiaries of this amendment. Following the acquisition of medical device maker Covidien, Medtronic is now the largest player in the market, with a market cap of more than $105 billion.
Medtronic recently also expanded its renal care solutions portfolio by acquiring private company Bellco, which makes systems for the treatment of renal failure, among others.
In terms of financial performance, over the past four quarters, Medtronic has constantly beaten analyst estimates on earnings-per-share (EPS). Even in the most recent quarter, the company reported EPS of $1.03, versus estimates of $1 and recorded a 1% rise over the same quarter a year earlier. This rise came even though it footed costs associated with its integration with Covidien.
While the stock is flat on a year-to-date (YTD) basis, analysts with a 12-month price target on the stock expect it to clock in gains of close to 17.5%.