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How Boston Scientific Plans to Expand in High-Growth Markets

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Overview

Boston Scientific has registered tremendous growth recently, driven by its robust growth strategies. The company’s key growth strategies include driving category leadership and expansion around the globe, creating shareholder value through a disciplined capital allocation strategy, developing stronger capabilities, improving operating margins, and expanding across high-growth markets.

Boston Scientific is focused on accelerating the company’s growth by expanding across high-growth markets outside the United States. As shown in the chart below, Boston Scientific is focused on expanding in key markets with high growth potential across the company’s entire business portfolio.

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Innovation led expansion across high-growth markets

Boston Scientific has a strong product portfolio and plans to launch key innovative products in high-growth markets to capture the untapped growth opportunities in such markets. As discussed in Boston Scientific’s Expansion Plans in a Fast-Growing Market, Boston Scientific’s sales mix has changed from ~50% of the company’s sales being generated from low-growth markets in 2012 to ~60% of the sales generated from mid- and high-growth markets in 2016.

BSX aims to reach mid- and high-growth market sales of ~70% of its total sales by 2020. The company aims to expand across high-growth adjacencies through locally relevant innovative products and solutions. By 2020, these markets are estimated to present ~$13 billion in incremental market opportunities for Boston Scientific.

The major US medical technology companies that are expanding in these markets include Medtronic (MDT), Becton Dickinson (BDX), and Stryker (SYK).

Investors can gain exposure to Boston Scientific yet diversify the company-specific risks by investing in the iShares Core S&P 500 ETF (IVV). BSX accounts for ~0.18% of IVV‘s total holdings.

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