And when investors returned to purchasing healthcare stocks, medical device companies were rewarded with magnified earnings growth and skyrocketing stock performance. This consolidation in the medtech industry has provided a second means for medical device companies to deal with the uncertainties of the political environment. Although the merger mania resulted in some assimilation indigestion, for the most part the new, larger companies are now fully integrated. Well Spent The most important strategic decisions any company makes involve determining the best use of its resources. Companies have many choices about where to invest their funds, but Wall Street tends to react more favorably to companies that make internal investments and accretive acquisitions.
Investors like to see companies that can take any or all of the following actions.
Increase overseas manufacturing capacity to fill market needs and to reduce foreign exchange financial impact. Expand sales and marketing functions, especially by adding larger sales forces to handle higher product demand. Leverage the company's existing technologies or distribution capabilities. Purchase the company's own stock. Obviously, a number of medical device companies are now much larger than they were in the past.