Stryker Corporation

New York Stock Exchange
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Slightly Bearish -15

Is ResMed A Better Way Than Stryker To Own Medical Device Growth?

Acquisition AI-generated analysis

📊 Stryker (SYK) narrowed its 2026 organic sales growth forecast to a range of 8.3% to 9.3% following strong capital product orders.

⚠️ A persistent manufacturing issue in Stryker's peripheral vascular business has created meaningful backorders, leading to an 8.8% share price drop on September 8, 2026.

💰 Stryker maintains a 22% operating margin and retains $14.40 of net profit for every $100 of sales generated over the past year.

🏭 The company is executing growth through acquisitions, including the recent closure of its AVS deal in peripheral vascular and an agreement to buy ZuriMED for shoulder offerings.

💸 Stryker carries 12.3% debt relative to its market value, significantly higher than ResMed's 2.5%, reflecting a more leveraged capital structure.

📉 Shares of Stryker lost 26% over the past year including dividends, while management noted that beating forecast tops requires a stronger procedure market or faster production.

🔍 Analysts note that Stryker's case relies on its scale and elevated backlog to justify a higher earnings multiple compared to smaller peers like ResMed.

📈 The company sells a broad range of products including hip and knee replacements, positioning it as a giant in the medical device space with diversified revenue streams.

Bullish Signals
  • Stryker ended the second quarter with an elevated backlog and zero cancellations, indicating strong demand for its capital equipment and orthopedic products.
  • Management tied the raised low end of the 2026 sales forecast to robust orders specifically within its capital products segment.
Risk Factors
  • A supply disruption in Stryker's peripheral vascular business persists, leaving a meaningful backorder that management expects to resolve only by the end of the third quarter.
  • Shares fell 8.8% on September 8, 2026, after the CFO confirmed that the peripheral vascular manufacturing issue once thought resolved still continues.
Full Analysis
Stryker (SYK) and ResMed are being compared as investment alternatives within the medical device sector, with Stryker positioned as a larger giant selling orthopedic products and capital equipment while ResMed focuses on sleep devices. The analysis highlights that while both companies have shared average sales growth rates over the past three years, they differ significantly in valuation metrics, profit margins, and debt levels. Stryker recently narrowed its 2026 sales forecast to an organic growth range of 8.3% to 9.3%, citing strong orders for capital products and a healthy backlog with zero cancellations. However, the company faces a persistent supply disruption in its peripheral vascular business that has resulted in meaningful backorders, causing shares to fall 8.8% on September 8, 2026, after management confirmed the issue remains unresolved. Financially, Stryker maintains an operating margin of 22% and retains $14.40 of net profit per $100 of sales, compared to ResMed's superior 34% margin and $26.90 retention. Stryker is also more leveraged with debt at 12.3% of market value versus ResMed's 2.5%, though it trades at a lower price-to-sales multiple of 4.7x compared to ResMed's 5.9x. The article concludes that while ResMed currently leads on earnings multiples, growth rates, and profitability, Stryker offers scale and an elevated backlog. The evidence generally favors ResMed unless Stryker can exceed the top end of its own full-year 2026 growth forecast to justify its higher valuation multiple.