NEW YORK, April 4, 2011 /PRNewswire/ -- Covidien Plc (COV: $53) has been picked by Standard & Poor's Equity Research as its Focus Stock of the Week. COV carries S&P's highest investment recommendation of 5-STARS, or Strong Buy. Covidien is one of the largest suppliers in the world of certain medical devices, specialty pharmaceuticals and medical supplies, and is number-one or number-two in businesses representing more than 75% of its sales. The medical devices segment, the company's fastest growing segment, accounts for about two-thirds of its annual revenues.
"We believe Covidien has improved its top-line growth prospects through portfolio optimization," said Phillip Seligman, Healthcare Analyst at Standard & Poor's Equity Research. "Since its formation when Tyco International was split into three companies in July 2007, it has completed 12 acquisitions, 10 licensing agreements, and eight divestitures of underperforming businesses."
Seligman noted that while U.S. and European procedure volume growth has been tepid, Covidien's mix shift has enabled it to increasingly penetrate the hospital markets. "Other growth drivers we see include accelerated new product launches, sales force expansion, and increasing penetration of emerging markets," added Seligman. "Long term, we expect volume trends to benefit from the aging U.S. and rest-of-world populations and improving living standards in emerging markets."
To view a video of Mr. Seligman discussing COV, paste the following link into your browser.
About Standard & Poor's Equity Research Services
As one of the world's largest producers of independent equity research, Standard & Poor's licenses its research to global institutions for their investors and advisors. Standard & Poor's team of experienced U.S., European and Asian equity analysts use a fundamental, bottom-up approach to assess a global universe of equities across industries worldwide. Follow Standard & Poor's equity analysts' U.S. market commentary each day at http://www.equityresearch.standardandpoors.com/.
Standard & Poor's keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of their respective activities. As a result, certain business units of Standard & Poor's may have information that is not available to other Standard & Poor's business units. Standard & Poor's has established policies and procedures to maintain the confidentiality of certain non-public information received in connection with each analytical process. Standard & Poor's does not trade for its own account. The analytical and ethical conduct of Standard & Poor's equity analysts is governed by the firm's Research Objectivity Policy, a copy of which may also be found at www.standardandpoors.com or by clicking here.
All information provided by Standard & Poor's is impersonal and not tailored to the needs of any person, entity or group of persons. Past performance is no indication of future results. Standard & Poor's and its affiliates provide a wide range of services to, or relating to, many organizations, including issuers of securities, investment advisers, broker-dealers, investment banks, other financial institutions and financial intermediaries, and accordingly may receive fees or other economic benefits from those organizations, including organizations whose securities or services they may recommend, rate, include in model portfolios, evaluate or otherwise address.
This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors. Any opinions expressed herein are given in good faith, are subject to change without notice, and are only current as of the stated date of their issue. Prices, values, or income from any securities or investments mentioned in this report may fall against the interests of the investor and the investor may get back less than the amount invested. Where an investment is described as being likely to yield income, please note that the amount of income that the investor will receive from such an investment may fluctuate. Where an investment or security is denominated in a different currency to the investor's currency of reference, changes in rates of exchange may have an adverse effect on the value, price or income of or from that investment to the investor. The information contained in this report does not constitute advice on the tax consequences of making any particular investment decision. This material does not take into account your particular investment objectives, financial situations or needs and is not intended as a recommendation of particular securities, financial instruments or strategies to you nor is it considered to be investment advice. Before acting on any recommendation in this material, you should consider whether it is suitable for your particular circumstances and, if necessary, seek professional advice.
This material is based upon information that we consider to be reliable, but neither S&P nor its affiliates warrant its completeness, accuracy or adequacy and it should not be relied upon as such. With respect to reports issued to clients in Japan and in the case of inconsistencies between the English and Japanese version of a report, the English version prevails. With respect to reports issued to clients in German and in the case of inconsistencies between the English and German version of a report, the English version prevails. Neither S&P nor its affiliates guarantee the accuracy of the translation. Assumptions, opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice. Neither S&P nor its affiliates are responsible for any errors or omissions or for results obtained from the use of this information. Past performance is not necessarily indicative of future results.
SOURCE Standard & Poor's