JPMorgan says time to buy MedTech based on past
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Buy MedTech stocks, JPMorgan said in a recent research note based on historical trends, notwithstanding the subsector's notable YTD underperformance.
As indicated in this graph, the iShares U.S. Medical Devices ETF (NYSEARCA:IHI) is trailing the broader market and the healthcare sector this year.

JPMorgan analyst Robbie Marcus points out that MedTech trades at the lowest level of sentiment since the 2008/09 crisis, indicating a negative 2.5 standard deviation.

Marcus has found that MedTech drove outperformance on average over the three-month, six-month, and one-year periods after reaching a -2 standard deviation in the past, as is the case now.
According to the analyst, after similar events, MedTech was up 7% vs. the S&P and +3% vs. Healthcare at three months, +6% and -2% at six months, and 8% and 2% at year one.
Excluding a point when COVID negatively impacted procedure volumes and, therefore, MedTech, the returns improved to +9% vs. the S&P and +6% vs. Healthcare at three months, +9% and +1% at six months, and +11% and +9% at year one. "In our opinion, that's meaningful," the analyst concluded.

Large-cap MedTech stocks: Johnson & Johnson (JNJ), Abbott Laboratories (ABT), Medtronic (MDT), Intuitive Surgical (ISRG), Stryker Corporation (SYK), Becton, Dickinson (BDX), Boston Scientific (BSX), Edwards Lifesciences (EW), DexCom (DXCM), Zimmer Biomet (ZBH), ResMed (RMD), Steris (STE), Baxter International (BAX), Teleflex Incorporated (TFX)


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