After review, we decided to trim Stryker by 70bps, and put the proceeds in cash (IVV) until our next idea makes it into the portfolio. Stryker is currently our biggest relative weight, yet at today’s valuation (+8% upside on our new $198 price target) we think this carries too much risk. The Medtech sector has seen its multiple expand in the past decade, helped by healthy fundamental drivers. While we think Stryker still has room to grow, the Medtech sector now trades at a 40% premium vs. the market.
Julie S. Praline
Director, Equity Analyst
Direct: 617.226.0025
Fax: 617.523.8118
Crestwood Advisors
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Boston, MA 02109