Should Investors Buy Boston Scientific Stock Despite Near-Term Risks?

Boston Scientific Corporation BSX retains durable medical-device franchises, but its investment case has become harder to defend. Management lowered its 2026 outlook as WATCHMAN demand weakened, U.S. electrophysiology lost share and operating leverage fell short.

The stock’s valuation has compressed, creating potential upside if execution improves. Yet limited earnings visibility through 2027, higher debt and delayed product catalysts suggest investors may be better served by waiting for clearer signs of stabilization.

Why Boston Scientific’s Growth Outlook Has Weakened

Boston Scientific cut its 2026 organic sales growth guidance to 5%-6% from 6.5%-8%. Adjusted earnings guidance fell to $3.28-$3.32 per share from $3.34-$3.41, while third-quarter organic growth is expected at 3%-5%.

Here's where the consensus estimates for the company's 2026 earnings currently stand.

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The company now anticipates only 0-25 basis points of adjusted operating-margin expansion in 2026. Lower WATCHMAN and electrophysiology sales are hurting product mix, and elevated supply-chain and quality-system spending remains a drag. Management expects revenue growth below its weighted-average market rate and limited adjusted earnings growth in 2027.

BSX Faces Pressure in WATCHMAN and Electrophysiology

U.S. WATCHMAN demand slowed as new clinical evidence disrupted patient identification and referral patterns. Standalone procedures declined at a low-teens rate in the second quarter, while management expects global WATCHMAN sales to fall at a mid- to high-single-digit rate in the second half of 2026.

Electrophysiology presents another near-term challenge. U.S. share losses exceeded expectations, and the existing FARAPULSE portfolio may not offset the pressure now that pulsed-field ablation represents about 80% of the U.S. atrial fibrillation market. Medtronic plc MDT is expanding its Affera and PulseSelect pulsed-field ablation offerings, while Johnson & Johnson JNJ is advancing its VARIPULSE platform, underscoring the competitive intensity confronting Boston Scientific’s FARAPULSE franchise.

Boston Scientific Still Has Durable Growth Engines

The broader portfolio remains resilient. Second-quarter organic sales rose 12.2% in Neuromodulation and 7% in Endoscopy. International operations also provided support, with operational growth of 11.2% in Asia-Pacific and 16.2% in Latin America and Canada.

Interventional Cardiology, the FARAPULSE ecosystem, OPAL mapping, WATCHMAN FLX Pro and the wider pipeline could support longer-term growth. The Penumbra transaction and MiRus investment add vascular and structural-heart opportunities. Edwards Lifesciences Corporation (EW), whose transcatheter aortic valve replacement sales grew 11.3% in the second quarter of 2026, shows the scale of the structural-heart market Boston Scientific hopes to re-enter.

BSX Valuation Reflects Both Damage and Uncertainty

BSX trades at 14.6X forward 12-month earnings, below its five-year median of 25.2X, the Medical-Products sub-industry’s 17.3X and the broader sector’s 20.6X. That discount could reward investors if growth and margins recover.

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The lower multiple also reflects material uncertainty. Earnings estimates have moved down, key recovery products are not expected until the second half of 2027 or later and execution remains critical. Cash fell to $539 million at the end of the second quarter, while total debt increased to about $12.62 billion.

Why BSX's Bearish Signals Still Matter

The balance of evidence favors patience rather than an aggressive purchase. Boston Scientific has valuable franchises and a credible pipeline, but weaker guidance, competitive gaps and delayed catalysts leave little room for execution errors.

BSX currently carries a Zacks Rank #5 (Strong Sell), indicating an unfavorable earnings-estimate revision trend over the next one to three months. Its Value Score of C, Growth Score of C, Momentum Score of C and VGM Score of C provide no strong style-based counterweight. The valuation is cheaper, but the near-term risk-reward profile still supports waiting for better visibility.

You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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