MAY RECAP & BEYOND
The S&P 500 (SPX) outperformed the Healthcare Sector for the first time in 2018, gaining 2.2% in the month, and now up 1.2% for the year. Healthcare posted flat returns for the month, down about a half percent for the year. MedTech again posted strong outperformance in May, setting the industry’s highest monthly return for the year, up 5.8% driving performance of nearly 15% YTD. Providers & Services rolled over following April’s stellar growth, down 1.3% while Pharma continues to disappoint, down 1.8% for the month (and down 6.3% YTD).
Tradeshows, Investor Meetings and Investment Bank Conferences Punctuated May
May is always a busy month, with tradeshow season and Wall Street conferences underway, and this month was no exception. In addition to Heart Rhythm Society (HRS) and EuroPCR, Medtronic (MDT), Baxter (BAX) and Teleflex (TFX) all held analyst meetings.
Inspire IPO – Opening the Window for MedTech?
Within the Medtech sector, Inspire Medical Systems priced its IPO in early May, with the stock trading up roughly 100% in its first month of trading. This has driven incrementally more confidence that investor appetite for earlier stage growth stocks has risen, potentially opening the window for additional IPOs in the sector. Expectations are for several biotech companies as well a select few MedTech companies to hit the road in June with sights set on an IPO.
Capital Markets Continue to Build, Driven By Life Sciences
Equity market new issuances ticked up in May, with eight IPOs and 23 Follow-On offerings in May, a year over year increase of 33% and 21% respectively. May IPOs raised a total of $663M (+15% yoy) while Follow-Ons raised a total of $1.84B (-49% yoy). Of the eight IPOs in the month, seven were within Life Sciences, and its expected that several more (10-12) are on track to price in June.
Source: Thompson Reuters and FactSet