Buy, Sell, Or Hold Boston Scientific Stock At $100?

Boston Scientific (NYSE:BSX) has seen its stock price surge over 30% in the past twelve months, significantly outpacing the S&P 500’s 9% gain. This impressive performance is attributed to new product launches, which have bolstered sales growth and expanded profit margins. However, the crucial question for investors is whether BSX stock, currently trading around $100, presents a compelling buying opportunity. We think that at its present valuation, Boston Scientific appears relatively expensive, particularly when compared to the broader market and its own historical metrics. That said, if you seek upside with lower volatility than individual stocks, the Trefis High-Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 91% since its inception. Separately, see – Will Adobe Stock See Higher Levels?

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Valuation Compared to the S&P 500

When assessing Boston Scientific’s valuation against the S&P 500, the stock presents as notably expensive across key metrics. The company’s price-to-sales (P/S) ratio stands at 8.3, substantially higher than the S&P 500’s 3.0. Similarly, its price-to-free cash flow (P/FCF) ratio of 38.0 dwarfs the benchmark’s 20.5. Furthermore, Boston Scientific’s price-to-earnings (P/E) ratio is a significant 71.4, compared to the S&P 500’s 26.4. These figures collectively indicate that investors are paying a substantial premium for Boston Scientific’s sales, profits, and cash flow relative to the overall market. Look at – Boston Scientific’s Valuation Ratios – for more details.

Revenue Growth Performance

Boston Scientific has demonstrated considerable revenue growth in recent years. Over the last three years, its top line has expanded at an average rate of 13.1%, significantly outperforming the S&P 500’s 5.5% increase. More recently, Boston Scientific’s revenues grew by 19.4% over the last twelve months, increasing from $15 billion to $18 billion. In its most recent quarter, quarterly revenues saw a robust 20.9% rise, reaching $4.7 billion from $3.9 billion a year ago. These figures underscore the company’s strong operational momentum in driving sales.

Profitability Analysis

The company’s profit margins generally sit around the median for companies within the Trefis coverage universe. Over the last four quarters, Boston Scientific’s operating income was $3.2 billion, translating to a good operating margin of 18.5%, which is higher than the S&P 500’s 13.2%. Boston Scientific’s Operating Cash Flow (OCF) for the same period was $3.8 billion, indicating a good OCF margin of 21.7% compared to the S&P 500’s 14.9%. Boston Scientific’s Net Income for the last four quarters was $2.0 billion, yielding a moderate net income margin of 11.6%, aligning with the S&P 500’s average.

Financial Stability

Boston Scientific’s balance sheet appears to be moderate. As of the most recent quarter, the company’s debt stood at $12 billion, against a substantial market capitalization of $147 billion (as of June 13, 2025). This translates to a strong Debt-to-Equity Ratio of 8.1%, which is considerably lower and more desirable than the S&P 500’s 19.9%. However, a minor concern arises from its cash position; cash and cash equivalents of $725 million represent a poor Cash-to-Assets Ratio of 1.8% when compared to total assets of $40 billion, and significantly lower than the S&P 500’s 13.8%.

Resilience During Downturns

Boston Scientific’s stock has shown mixed performance during past market downturns, at times faring worse than the S&P 500. During the “Inflation Shock” of 2022, BSX stock experienced a 25.2% decline, aligning closely with the S&P 500’s 25.4% drop, and fully recovered by December 2022. The COVID-19 pandemic in 2020 saw a more significant impact, with BSX stock falling 43.5% compared to the S&P 500’s 33.9% decline, though it fully recovered by August 2021. The Global Financial Crisis of 2008 presented the most substantial challenge, with BSX stock plummeting 70.5% against the S&P 500’s 56.8% fall, and taking until November 2015 to fully recover.

Conclusion and Outlook

In summation, Boston Scientific exhibits “Extremely Strong” growth, “Strong” profitability, and a “Neutral” financial stability profile. However, its “Weak” downturn resilience and, most notably, its “Very High” valuation contribute to an “Overall Neutral” assessment. The current price-to-sales ratio of 8.3x is considerably higher than Boston Scientific’s historical average of 5.9x, indicating that the stock is presently trading at a significant premium. While Boston Scientific’s improving sales growth and profitability are positive indicators that could attract continued investor interest, the elevated valuation at current levels presents a heightened risk.

For investors seeking upside with lower volatility than individual stocks, portfolios like the Trefis High Quality (HQ) portfolio and Reinforced Value (RV) Portfolio offer alternatives. The HQ Portfolio, with its focus on risk assessment and a collection of 30 stocks, has a proven track record of outperforming the S&P 500 over the past four years, delivering better returns with less risk. Similarly, the RV Portfolio, which rebalances quarterly with a mix of large, mid, and small-cap stocks, has outperformed its all-cap stocks benchmark.

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