Reasons to Retain Penumbra Stock in Your Portfolio for Now

Penumbra, Inc.’s PEN thrombectomy business is thriving, driven by growing sales of the U.S. vascular thrombectomy and CAVT (computer-assisted vacuum thrombectomy) line of products. The company’s robust product portfolio expansion is poised to drive growth in the upcoming quarters. Meanwhile, unfavorable foreign exchange and intense competition may pose operational risks for PEN.               

In the past year, shares of this Zacks Rank #2 (Buy) company have increased 19.8% against the industry’s 18.4% decline and the S&P 500 composite’s fell of 1.9%.

The global healthcare provider company has a market capitalization of $10.15 billion. PEN beat on earnings in three of the trailing four quarters and missed on one occasion, the average surprise being 10.42%.

Tailwinds for Penumbra

Strong Portfolio Expansion: Penumbra is still in the early stages of its journey to bring the company’s proprietary thrombectomy technologies to patients in the United States and abroad. In terms of product launch, the Element Vascular Access System was launched in January 2025. Penumbra also launched its Lightning Bolt 12 and Lightning Bolt 6x with TraX in 2025. These additions to Penumbra's CAVT platform aim to enhance arterial and venous thrombus management. Further, the company received the CE Mark for Lightning Flash 2.0 and Lightning Bolt 7 in mid-September 2024 and is in the early stages of introducing its transformative technology to European markets.

In terms of pipeline, the company plans to focus on Flash and Bolt innovations. Combined with Flash and Bolt 7, Penumbra expects its CAVT portfolio to drive market share and growth in Deep vein thrombosis (DVT), Pulmonary embolism (PE) and arterial. As of February 2025, Penumbra's Thunderbolt aspiration tubing underwent evaluation in the THUNDER IDE clinical study for treating acute ischemic stroke. 

Robust Thrombectomy Business Growth: PEN is demonstrating strong growth within its Thrombectomy business, banking on the rapid increase in sales of its vascular thrombectomy products in the United States and its CAVT line of products.  The company is currently working with the regulatory and reimbursement bodies in Europe, Asia-Pacific and Latin America to bring the entire CAVT portfolio to patients internationally. 

In the fourth quarter of 2024, the company delivered 27.3% year-over-year growth in thrombectomy in the United States, driven by continued adoption and further market penetration of the current CAVT Portfolio, Lightning Flash 2.0 and Lightning Bolt 7. The U.S. VTE franchise delivered revenue growth of 41% year over year. 

Headwinds for Penumbra

Foreign Exchange Impacts Sales: A significant portion of Penumbra’s sales and costs is exposed to changes in foreign exchange rates. The company’s operations use multiple foreign currencies, including the euro and Japanese yen. Changes in those currencies relative to the U.S. dollar will impact its sales, cost of sales and expenses, and consequently, net income.

Tough Competitive Landscape: Penumbra operates in the highly competitive medical device industry, which is subject to rapid change and significantly affected by new product introductions and other market activities of industry participants. Large players have greater resources than Penumbra, enabling them to invest more in product development and marketing. The company also competes with several smaller medical device companies that have single products or a limited range of products.

PEN Stock Estimate Trends

In the past 30 days, the Zacks Consensus Estimate for Penumbra’s 2025 earnings has moved south 0.5% to $3.64.

The Zacks Consensus Estimate for 2025 revenues is pegged at $1.35 billion, indicating a 13.1% rise from the year-ago reported number. 

Key Picks

Some better-ranked stocks in the broader medical space are Phibro Animal Health PAHC, Boston Scientific BSX and Cardinal Health CAH.

Phibro Animal Health has an estimated fiscal 2025 earnings growth rate of 62.2% compared with the industry’s 17.2%. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 27.06%. The company’s shares have surged 73.5% compared with the industry’s 9.5% growth in the past year.

PAHC sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Boston Scientific, carrying a Zacks Rank #2 (Buy) at present, has an earnings yield of 2.7% compared with the industry’s 1.5%. Shares of the company have rallied 47.1% compared with the industry’s 9.5% growth. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.25%.

Cardinal Health, carrying a Zacks Rank #2 at present, has an estimated long-term earnings growth rate of 10.7% compared with the industry’s 9.5%. Shares of the company have rallied 17.5% against the industry’s 3.2% decline. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.64%.

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This article originally published on Zacks Investment Research (zacks.com).

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