Philips' Vereos Digital PET/CT to Aid Clinique de Genolier

Koninklijke Philips N.V. PHG recently announced that it has successfully installed Vereos digital PET/CT system, in addition to its Ambient Experience solution in the Clinique de Genolier, one of Switzerland’s largest private clinics. Utilizing the superior molecular imaging capabilities of Vereos, physicians will be able to make decisions with greater insight as well as confidence.

Touted as the first and only fully digital PET/CT system in the world, Vereos simplifies the clinical decision making process through a rapid and more confident way to treatment of cancer. Simultaneously, the company’s Ambient Experience solution will create a relaxing environment throughout PET/CT imaging procedures by employing dynamic lighting, video and sound.

Currently, the Vereos PET/CT system is being installed in other leading healthcare facilities across the world to enhance the patient experience. Also, the company is producing and shipping its Computed Tomography (“CT”) as well as Advanced Molecular Imaging (“AMI”) portfolio from its sites located in Haifa, Suzhou and Cleveland.

Existing Business Scenario

Philips has expanded presence in the healthcare markets in recent quarters and expects this segment to be a long-term growth driver. However, the company’s near-term profitability is likely to be hurt by sluggish growth prospects of the healthcare market on a global scale. For instance, the company expects the United States to witness low-single digit growth in the healthcare industry, in light of uncertainties like slowing government spending and events surrounding the ACA (Affordable Care Act) legislation. Not surprisingly, the Zacks Rank #4 (Sell) company has returned 3.9% in the last six months, underperforming the industry’s growth of 7.5%.

Moreover, the company has a geographic presence in more than 80 countries making it exposed to a number of regional and local regulatory rules in sensitive areas like healthcare. The company believes such stringent rules expose it to difficulties in obtaining clearances or approvals for new products, which in turn, may lead to unfavorable performance. Further, the industry in which the company operates is highly dynamic, which indicates that failure to accelerate the company’s innovation-to-market processes may lead to adverse effects on financial condition as well as operating results.

Stocks to Consider

Some better-ranked stocks in the same space are Garmin Ltd. GRMN, Apptio Inc. APTI and Control4 Corporation CTRL. While Garmin sports a Zacks Rank #1 (Strong Buy), Apptio and Control4 carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank  stocks here.

Garmin has surpassed estimates in the trailing four quarters, with an average positive earnings surprise of 15.9%.

Apptio has outpaced estimates in the preceding four quarters, with an average earnings surprise of 47.6%.

Control4 has outpaced estimates in the preceding four quarters, with an average earnings surprise of 100.7%.

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