2024-05-16 08:44:19 ET
Summary
- Johnson & Johnson's acquisition of Shockwave Medical is expected to benefit J&J's investors due to positive trends in sales, revenue, and cash flow.
- Shockwave Medical has a strong product portfolio and a growing market value in the intravascular lithotripsy (IVL) technology.
- The merger will expand J&J's presence in the cardiovascular intervention market and prevent competitors from acquiring SWAV's technology.
Thesis
Considering Shockwave Medical's (SWAV) latest Q1 2024 report , which revealed positive trends in sales, revenue and cash flow, the increasing market value and adoption of the intravascular lithotripsy ((IVL)) technology, together with the positive results of the multiple clinical trials associated with the IVL, I think SWAV stock is a “Buy”. Therefore, in my opinion, Johnson & Johnson's (JNJ) investors will be pleased with the acquisition of SWAV. Taking into account the value to investors and the potential to increase revenues of JNJ’s cardiovascular MedTech sector, I rate JNJ stock as a “Buy”.
Overview
SWAV is a medical device company founded in 2009, it became public in 2019, and it is headquartered in Santa Clara, California. The company focuses on the development and commercialization of IVL for the treatment of calcified plaques with peripheral and coronary vascular, and heart valve diseases (see image below). The IVL technology has seen increasing adoption, given its safety and efficiency in the treatment of otherwise very difficult to treat calcified plaques. Recently, SWAV and JNJ announced that they have reached an agreement by which JNJ will acquire SWAV for $13.1 billion. The merger is expected to be completed by mid-2024. Previously, it was rumored that Boston Scientific ( BSX ) was interested in acquiring SWAV, however, as far as I am aware, BSX’s management never confirmed or denied the rumors....
Read the full article on Seeking Alpha
For further details see:
Shockwave Medical: A Look Into Q1 Financials And Value To Johnson & Johnson Investors