NANO Arm Profits for Bruker, MERLIN Buyout Holds Promise

On January 5th, we issued an updated research report on Bruker CorporationBRKR . The stock carries a Zacks Rank #2 (Buy).

Bruker has been trading above the broader industry over the past three months. The stock has returned 18.7%, higher than the 6% gain of the broader industry during the period.

In the last three quarters, Bruker's NANO Surfaces group business realized profitability owing to prior restructuring and cost actions. In the last-reported third quarter 2017, high-single-digit growth was driven by contributions from Hysitron nanoindenting product's acquisition in January 2017 and improved results at the AXS business.

Moving on, the company's strategic acquisition activity has also been encouraging. For instance, the company recently announced the completion of its Germany-based MERLIN's buyout. Products of the acquired company can complement Bruker's MALDI Biotyper platform.

More good news is that Bruker's MALDI Biotyper franchise has grown into an impressive system worth approximately $90 million per annum. We are happy to note that demand for the MALDI Biotyper is increasing in the applied markets, specifically for food, feed and beverage categories/segments.

Based on recent developments witnessed in its product portfolio, management believes that Bruker is poised to double its microbiology business over the next four-five years. The company's raised 2017 guidance is also indicative of brighter prospects.

On the flip side, Bruker conducts 80% of its business in the international markets. As a result, adverse currency fluctuations continue to incur losses for the company. Also, headwinds like unfavorable economic conditions and an intense competition continue to pose threats.

Other Key Picks

Some other top ranked stocks in the broader medical space are, ABIOMED Inc. ABMD , Tactile Systems Technology TCMD and Intuitive Surgical Inc. ISRG , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank Stocks Here .

ABIOMED has a long-term expected earnings growth rate of 31.5%. The stock has rallied 72.8% over the last year.

Tactile Systems has a long-term expected growth rate of 20%. The stock has soared 81.5% over the last year.

Intuitive Surgical has a long-term expected growth rate of 9.2%. Over the last 6 months, the stock has rallied 20.1%.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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