Becton, Dickinson and Co. (BDX): This Healthcare Stock Can Continue Its Rally

Meanwhile, shares of St. Jude Medical, Inc. (NYSE:STJ) have surged nearly 50% over the last year. The company manufactures and markets cardiovascular medical devices, and is the second largest manufacturer of Cardiac Rhythm Devices in the U.S. But, on the downside, St. Jude isn’t as geographically diversified as its peers mentioned above are, which makes it a volatile play. For FY13, management of St. Jude expects its annual EPS to average around $3.70 – $3.73 per share.

Final words

From the standpoint of valuations, both Baxter International Inc. (NYSE:BAX) and St. Jude Medical, Inc. (NYSE:STJ) appear to be undervalued. However. Becton, Dickinson and Co. (NYSE:BDX) seems to be fairly valued. But, it’s worth noting that Its ROE of 34.8% is one of the highest in the entire healthcare industry. Besides that, analysts expect its annual EPS to grow nearly 9.5% over the next five years, and Argus estimates that its shares could appreciate another 15%. Keeping all the reasons in mind, I believe that Becton Dickinson is a good investment option.

The article This Healthcare Stock Can Continue Its Rally originally appeared on Fool.com.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.