BOSTON SCIENTIFIC CORP (BSX): what the price requires

At today's price, BOSTON SCIENTIFIC CORP (BSX) is priced for +6.0% growth. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.

Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/BSX

Headline

FieldValue
TickerBSX
CompanyBOSTON SCIENTIFIC CORP
Current price$44.54/sh
CompositionEndoscopy 15% / Urology 14% / Neuromodulation 6% / Interventional Cardiology & Vascular Therapies 23% / Watchman 10% / Electrophysiology 17% / Cardiac Rhythm Management 12% / Interventional Oncology & Embolization 5%

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basiswhole-company
Operating margin needed3.5%
Operating margin today19.5%
Margin compression implied-16.0pp
Implied growth6.0%
Multiple paid20x operating income

The operating-margin requirement is derived from the framework's value band at year 9, a separately labeled basis from the headline growth/duration solve.

Solve inputs: computed at a 7.8% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~7.3pp.

Reconcile: at the x-ray's 9.3% required return this reads ~15.9%/yr; the models below use their own rates.

How unusual the bet is: within-range

ReferenceValue
vs own history+0.44σ
cohort percentile (of 112 peers)42
implied end-window share0%

Valuation X-Ray

The price is justified by relative-multiple and growth-DCF; earnings-power land below the price.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset1.46x5expensive
Earnings1.72x5expensive
Relative0.72x5justifies
Growth0.74x3justifies

Families that justify the price: Relative, Growth Families that call it expensive: Earnings

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.3%); the inversion above states its own rate.

Per-Model Detail (n=18)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$73.520.61xyesFCF base $3.9B, growth 18% (input: historical growth), terminal g 4.0%, WACC 9.2%, 6yr projection
DCF Exit MultipleGrowth$60.230.74xyesExit EV/EBITDA: 10.6x / 12.6x / 14.6x (bear / base = today's held flat / bull), 6yr
Relative ValuationRelative$61.830.72xyesP/E 24x (static sector reference · 2026-04), scenarios: 19.7x / 24.0x / 28.3x (bear / base = reference held flat / bull), EV/EBITDA 16x
Simple DDMGrowth——no—
Two-Stage DDMGrowth——no—
Simple Excess ReturnAsset$25.741.73xyesBV/sh $17.30, ROE (TTM) 13.8%, ke 9.3%
Two-Stage Excess ReturnAsset$31.081.43xyes5yr excess ROE then converge to ke=9.3%
Discounted Future Market CapGrowth$47.100.95xyesRev $20.6B, growth 18% (input: historical growth; tapered), Terminal P/S: 2.7x / 3.2x / 3.8x (bear / base = today's held flat / bull, cap 12x)
Peter Lynch Fair ValueRelative$83.650.53xyesEPS $2.39, growth 35% (input: historical EPS growth), PEG=0.53 (Undervalued)
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings$16.232.74xyesNormalized EBIT (5y avg op income, one-time charges added back) $2.68B × (1−21%) / WACC 9.2% → EPV (no growth)
Residual IncomeAsset$32.141.39xyesBV $17.30 + 5yr PV of (ROE (TTM) 13.8% − Kₑ 9.3%) × BV; BV grows 8.8%/yr
Graham NumberAsset$30.501.46xyes√(22.5 × EPS $2.39 × BVPS $17.30) — Graham's conservative floor
EV/EBITDA RelativeRelative$56.460.79xyesEBITDA $5.19B × sector EV/EBITDA 16.0x
FCF YieldEarnings$26.071.71xyesFCF $3475.0M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF YieldEarnings$23.851.87xyesSBC-adj FCF $3.17B (FCF $3.48B − SBC $0.31B) capitalized at Kₑ
Ben Graham FormulaEarnings$77.120.58xyesEPS $2.39 × (8.5 + 2×15.0%) × (4.4 / 5.3%)
ROIC-Justified P/BAsset$6.666.69xyesBV $17.30 × (ROIC 3.6% / WACC 9.2%)
P/Sales SectorRelative$55.150.81xyesRevenue $20.61B × sector P/S 4.0x
PEG Fair ValueRelative$89.630.50xyesEPS $2.39 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x
Earnings YieldEarnings$25.841.72xyesEPS $2.39 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Net debt$10.3b
Net debt / NOPAT (after-tax)3.36x
Net debt / operating income (pre-tax)2.65x
Interest coverage11.1x
Share count CAGR (dilution)1.0%
Burning cashno

Bullet Takeaways

Bull Case

Begin with where the price sits against the methods, because the pattern is more favorable than the headline multiple suggests. Of the four families of valuation method, the peer-multiple lens and the forward-growth methods both reach or exceed today's price, while the asset-based and earnings-power lenses read it as expensive. That spread says something specific: the market is paying Boston Scientific a multiple in line with its medical-device peers and consistent with its growth, not a premium floating above what any standard method supports. For a company compounding revenue in the high single digits with a clear product cycle, a price the relative and growth frames defend is the bull's starting point, not a stretch.

The product cycle driving that growth is FARAPULSE, the pulsed-field ablation platform for treating atrial fibrillation. Global electrophysiology sales grew 22% organically in Q1 2026, with 18% growth in the U.S. and 30% internationally, as FARAPULSE adoption accelerated alongside the OPAL mapping platform. The competitive position is unusually strong for a device this new: Boston Scientific ran a more rigorous clinical program than its rivals, and in the Single Shot Champion trial FARAPULSE was superior to Medtronic's cryoablation catheter in reducing arrhythmia recurrence. Winning a head-to-head against an established standard of care is the kind of evidence that converts physician practice, and Boston Scientific entered the ablation market with limited prior share, which means the upside is share gain rather than defense.

The breadth of the portfolio is what makes the growth durable rather than dependent on one device. Boston Scientific spans interventional cardiology, electrophysiology, cardiac rhythm management, endoscopy, urology, neuromodulation, and interventional oncology, and the 10-K shows growth coming from multiple franchises at once; its Neuromodulation business, for instance, grew on the "Intracept™ Intraosseous Nerve Ablation System, and our spinal cord stimulation and deep brain stimulation franchises". A diversified device maker can absorb a soft quarter in one franchise while another accelerates. The balance sheet supports the strategy: net cash modestly positive, interest coverage near 11 times, and the cash generation to keep funding both internal R&D and the tuck-in acquisitions that have repeatedly refilled the pipeline. The bull case is that this is a quality compounder priced about right for its growth, with a genuine technology lead in the fastest-growing cardiac procedure.

Bear Case

The bear case begins with the competitors converging on Boston Scientific's best growth driver. FARAPULSE has an early lead in pulsed-field ablation, but Medtronic and Johnson & Johnson are both in the market, and J&J has launched a head-to-head trial, PERSIGMA, pitting its Varipulse platform directly against FARAPULSE. Pulsed-field ablation is a large, attractive market precisely because it is replacing older techniques, which means it draws the full weight of the two largest cardiac-device companies in the world. An early-mover advantage in a market this valuable is exactly what well-funded competitors target first. If Varipulse or Medtronic's next-generation system matches FARAPULSE on outcomes, the 22% organic EP growth that is carrying the story compresses toward the market's underlying rate, and the premium narrative around the platform fades with it.

That competitive risk lands harder because the price already requires the growth to persist. To justify today's level, Boston Scientific has to compound operating income at roughly 12% a year, well above the 6.5%-8% organic revenue growth management just guided to for the full year. The gap between a low-double-digit operating-income requirement and a mid-single-digit revenue guide has to be closed by margin expansion and mix, and the latest quarter pushed the other way: management cut guidance citing softer Electrophysiology, WATCHMAN, and Urology, and adjusted gross margin fell 100 basis points on tariffs and product discontinuations, with more margin pressure expected through year-end. A guidance cut in the same quarter the price needs accelerating profitability is the tension at the center of the bear case.

The broader pressure is structural to the device industry and the 10-K names it plainly: the company faces "competitive activity, increased market power of our customers as the health care industry consolidates, national and regional government tenders", and pricing pressure that grows as hospital systems and national health services consolidate purchasing. Layer tariffs on top, which the filing flags among its risks alongside "changing trade and tariff" conditions, and the margin story gets harder rather than easier. The asset-based and earnings-power methods already read the price as expensive; if the growth that the relative and forward methods are crediting slows under competitive and pricing pressure, those are the lenses the stock would re-rate toward, and they sit below today's price.

Valuation

The price embeds a clear operating bet. To justify today's level, Boston Scientific has to grow operating income at roughly 12% a year from a trailing operating margin near 18%. That is an achievable rate for a device maker with a live product cycle, but it sits above the 6.5%-8% organic revenue growth management guided to for the full year, so the price is leaning on operating leverage and mix to bridge the difference. Set against its peer cohort, that growth requirement is not unusual; it lands in the middle of the medical-device distribution rather than in the rare tail.

The methods divide in an informative way. The peer-multiple lens and the forward-growth methods reach or exceed the price, which is to say the market is valuing Boston Scientific roughly in line with comparable device makers and consistent with its expected growth. The asset-based and earnings-power lenses, which value the balance sheet and today's profit without crediting the device pipeline, sit below the price and read it as expensive. So the price is justified by the relative and growth frames and looks rich on the static ones, which is the normal signature of a quality grower: you pay for the franchise and the pipeline, not for the book value. Against peers like Intuitive Surgical and Edwards Lifesciences in the device cohort, Boston Scientific's blend of growth and a roughly 19 times earnings base is mid-pack rather than stretched.

Solvency is a non-issue and bounds the downside modestly. Net cash is slightly positive, interest coverage runs near 11 times, the company is not burning cash, and the share count has drifted up about 1% a year, a mild dilution rather than a capital-return story. The downside is not financial distress; it is multiple compression toward the earnings-power and asset lenses if the growth the price credits slows. The most direct path to that is the one the last quarter previewed: competitive pressure in electrophysiology and tariff-driven margin erosion narrowing the operating-income growth the price requires.

Catalysts

The Q1 2026 print captured both sides of the story. Sales rose 11.6% to $5,203 million, organic revenue grew 9.4%, net income reached $1,341 million, and EPS from continuing operations was $0.90, all ahead of expectations. The market's attention, though, went to the guidance: management lowered full-year organic revenue growth to 6.5%-8% and adjusted EPS to $3.34-$3.41, citing unanticipated headwinds in Electrophysiology, WATCHMAN, and Urology, plus a 100-basis-point drop in adjusted gross margin from tariffs and product discontinuations. A beat paired with a cut guide is why the reaction was mixed.

FARAPULSE remains the catalyst that matters most. The platform drove 22% organic electrophysiology growth, and Boston Scientific has continued to expand its FDA labeling and build clinical evidence, including head-to-head data showing superiority over Medtronic's cryoablation system. The competitive watch item is Johnson & Johnson's PERSIGMA trial directly comparing its Varipulse platform to FARAPULSE; the outcome of that and Medtronic's roadmap will shape whether Boston Scientific's early ablation lead holds or narrows. Analysts have largely framed the EP-share concern as the swing factor, with some viewing the post-guidance weakness as overdone given the early-mover position. The next print is the read on whether the guided deceleration is a one-time reset or the start of growth converging toward the market rate as competition arrives.

Peer Cohorts (Per Segment, With Filing Citations)

MedSurg (reported)

Cardiovascular (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

BSX Q1 2026 earnings release · Single Shot Champion trial reports, 2026 · massdevice / company trial announcements, 2026 · company and trial announcements, 2026 · analyst notes, 2026

View the full interactive BSX report on boothcheck