Stryker Corp (SYK) Presents at Cowen Healthcare Broker Conference Call - (Transcript)

Summary of Stryker Corp Conference Call Company Overview - Company: Stryker Corporation (NYSE: SYK) - Date: March 2, 2021 - Participants: Andrew Pierce (Group President, MedSurg & Neurotechnology), Preston Wells (VP, IR), Joshua Jennings (Cowen and Company) Key Industry Insights - Elective Procedures: The company observed a disruption in elective procedures due to COVID-19 but noted improvements in procedural volumes as hospitalization and infection rates declined. The expectation is for procedural volumes to continue increasing throughout the year [4][5][6] - Pandemic Impact: The pandemic has created a backlog of elective procedures that will contribute to growth as the situation normalizes. The trauma business has seen some positive effects from the pandemic disruptions [7][8] - Capital Equipment Trends: The capital spending environment for hospitals is improving, with expectations for recovery in capital purchasing as elective procedures resume. The company noted that capital represents about 45% of the MedSurg business, with 30% being small capital and 15% large capital [13][33] Financial Performance and Guidance - Revenue Growth: Stryker guided for corporate-wide revenue growth of 8% to 10% off the 2019 base, with expectations for MedSurg and Neurotechnology to be accretive to this growth [6][17][24] - Market Recovery: The company is optimistic about recovery in the capital equipment market, with signs of normalization observed in early 2021. The expectation is that as elective procedures return, capital purchases will follow suit [14][16][39] Product and Business Segment Highlights - Mako Installations: Record installations of Mako robotic systems in 2020 are expected to drive growth in knee and hip procedures as utilization increases [8] - Neurovascular Business: The neurovascular segment is expected to see significant growth, particularly with new product launches and a focus on ischemic stroke care, which presents a substantial market opportunity [50][51] - Endoscopy and Sports Medicine: The endoscopy business is performing well, with strong demand for surgical visualization and fluorescence imaging. The sports medicine segment has also shown high growth potential due to strategic acquisitions [43][45] M&A Strategy - Tuck-in Acquisitions: Stryker's M&A strategy focuses on tuck-in acquisitions that enhance its existing product portfolio. The company continues to explore opportunities for smaller acquisitions that can contribute to growth [26][30] - Integration Process: The integration of acquired companies is a key focus, with lessons learned from past acquisitions being applied to new deals. The company emphasizes a decentralized approach to business development [27][29] Market Outlook - Competitive Landscape: Stryker expects to outperform the market in the neurovascular space, with growth rates anticipated to exceed the market average of 13% to 15% [50][51] - Long-term Growth: The company remains confident in its ability to maintain high single-digit growth rates in its MedSurg and Neurotechnology segments, supported by a strong product portfolio and sales organization [23][24] Additional Considerations - COVID-19 Vaccine Impact: There is an expectation that some patients may defer elective procedures until vaccinated, but the rollout of vaccines is anticipated to accelerate recovery in procedural volumes [11][12] - Product Launches: New product launches, such as the ProCuity bed for acute care, are expected to drive demand and contribute positively to revenue growth [36][37] This summary encapsulates the key points discussed during the Stryker Corporation conference call, highlighting the company's outlook, market trends, and strategic initiatives.