Sometimes you want to align yourself with companies that don't have plans to grow overnight. After all, too much growth in a short amount of time can strain a company and hinder growth. With that in mind, we searched for healthcare stocks that have growth on the longer-term horizon. This time frame allows a company to grow steadily and meet the increase in demand with more precision. The healthcare stocks in our list today have EPS growth rates above 25% for the next five years. In addition, analysts have recently granted either a "Buy" or better rating to these stocks. We encourage you to look at the summaries below to start your own analysis.
EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. The 5-Year Expected EPS Growth Rate is a long term annual growth estimate, where the growth projections are made by analysts, the company or other credible sources.
We first looked for healthcare stocks. From here, we then looked for companies that are considered high-growth, with 5-year projected EPS growth above 25%. We next screened for businesses that analysts rate as "Buy" or "Strong Buy" (mean recommendation < 3). We did not screen out any market caps.
Do you think these stocks have more value to price in? Use this list as a starting-off point for your own analysis.
1) AtriCure, Inc. (ATRC)
|Industry||Medical Instruments & Supplies|
|5-Year Projected Earnings Per Share Growth Rate||50.00%|
AtriCure, Inc., a medical device company, engages in developing, manufacturing, and selling cardiac surgical ablation systems designed to create precise lesions or scars in cardiac tissue in the United States and internationally. Its product lines for cardiac tissue ablation includes AtriCure's synergy ablation system and related radio-frequency ablation devices, such as isolator bipolar radio-frequency ablation clamps for open-heart and minimally invasive procedures; ablation and sensing units, a compact power generator that delivers bipolar radio-frequency (RF) energy; AtriCure switch box to provide the technology needed for the dual pulsing electrodes, and to connect and toggle between multiple RF devices; and isolator multifunctional pens that are disposable RF devices enabling surgeons to toggle back and forth between temporary pacing, sensing, and stimulation and ablation. The company also offers cryoablation system, which consists of various reusable and disposable devices, including the Frigitronics CCS-200 product line for cardiac ablation; cryoIce, a disposable cryoablation device; and cryoICE BOX, a cryo generator, as well as AtriClip system, which is designed to exclude the left atrial appendage by implanting the device during concomitant open surgical procedures from the outside of the heart. In addition, it sells enabling technologies, which include Lumitip dissector to separate tissues to provide access to key anatomical structures targeted for ablation; and MicroPace ORLab system, a stimulating, mapping, and recording system enabling physicians to confirm the ablation lines being created are forming electrical barriers or lines of block. The company sells its medical devices to hospitals and medical centers through its direct sales force and distributors. AtriCure, Inc. is headquartered in West Chester, Ohio.
2) Solta Medical, Inc. (SLTM)
|Industry||Medical Appliances & Equipment|
|5-Year Projected Earnings Per Share Growth Rate||55.00%|
Solta Medical, Inc., together with its subsidiaries, engages in the design, development, manufacture, and marketing of energy-based medical device systems for aesthetic applications primarily in North America, the Asia Pacific, Europe, and the Middle East. It offers Fraxel re:pair system for use in dermatological procedures requiring ablation, coagulation, and resurfacing of soft tissue, as well as for rhytides, pigmentation, dyschromia, fine lines, acne, surgical scars, deeper lines, wrinkles, and actinic keratoses; and Clear + Brilliant system for patients who want to take control of their aging process. The company also provides Thermage CPT system that provides non-invasive treatment options for skin tightening; Liposonix system to destroy unwanted fat cells resulting in waist circumference reduction; Isolaz system for the treatment of inflammatory acne, comedonal acne, and mild to moderate inflammatory acne; and the CLARO device, a consumer handheld device for the treatment of mild-to-moderate inflammatory acne, including pustular acne. Its customers principally include dermatologists, plastic surgeons, general and family practitioners, gynecologists, and ophthalmologists. The company sells its products primarily through a direct sales force, as well as through independent distributors; and CLARO device through retail and associated retailer's Websites, and television retail networks, as well as through its own website in the United States. The company was formerly known as Thermage, Inc. and changed its name to Solta Medical, Inc. in January 2009. Solta Medical, Inc. was incorporated in 1996 and is headquartered in Hayward, California.
3) Accuray Incorporated (ARAY)
|Industry||Medical Appliances & Equipment|
|5-Year Projected Earnings Per Share Growth Rate||39.10%|
Accuray Incorporated designs, develops, and sells medical radiation systems for the treatment of tumors anywhere in the body. The company offers the CyberKnife system, an image-guided robotic radiosurgery system used for the treatment of solid tumors. The system tracks, detects, and corrects for tumor and patient movement in real-time during the procedure, enabling delivery of precise, high dose radiation typically with sub-millimeter accuracy. The company also offers the TomoTherapy system, which consists of an integrated and versatile radiation therapy system used for the treatment of a range of cancer types. Accuray Incorporated markets its product through a direct sales force and distributors worldwide. The company was incorporated in 1990 and is headquartered in Sunnyvale, California.
4) MAP Pharmaceuticals, Inc. (MAPP)
|Industry||Drug Manufacturers - Other|
|5-Year Projected Earnings Per Share Growth Rate||49.00%|
MAP Pharmaceuticals, Inc., a development stage company, focuses on the enhancement of the therapeutic benefits and commercial attractiveness of proven drugs in the field of neurology through its formulation and inhalation technologies. The company's lead product candidate includes LEVADEX, an orally inhaled version of dihydroergotamine mesylate [DHE] that has completed Phase III clinical trials for the acute treatment of migraine in adults. Its proprietary technologies consist of particle creation and formulation technologies, which can be applied to small or large molecules, including peptides and proteins; and aerosol delivery platforms, such as TEMPO inhaler, a pressurized metered dose inhaler [MDI] that dispenses drug automatically when the patient inhales. MAP Pharmaceuticals, Inc. was founded in 2003 and is based in Mountain View, California.
5) NPS Pharmaceuticals, Inc. (NPSP)
|5-Year Projected Earnings Per Share Growth Rate||80.00%|
NPS Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company, focuses on the development of therapeutic products for gastrointestinal and endocrine disorders, and various medical needs. The company's primary clinical programs include two therapeutic peptides to restore or replace biological functions comprising GATTEX, a Phase 3 clinical trial product for short bowel syndrome; and Natpara, a recombinant human parathyroid hormone 1-84, which is in Phase 3 clinical development trials. It also develops NPSP790 and NPSP795 calcilytic compounds that are in Phase I trials for the treatment of rare endocrine disorders. The company has collaborative and license agreements with Amgen Inc., Janssen, GlaxoSmithKline, Kyowa Hakko Kirin, and Nycomed Danmark ApS. NPS Pharmaceuticals, Inc. was founded in 1986 and is based in Bedminster, New Jersey.
*Company profiles were sourced from Google Finance and Yahoo Finance. Financial data was sourced from Finviz on 08/29/2012.
Disclaimer: This article was prepared for ZetaKap Media by one of our full-time analysts. We did not receive compensation for this article (other than from Seeking Alpha), and we have no business relationship with any company whose stock is mentioned in this article.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.