Needham reiterates Hold rating on Masimo stock after Q2 earnings beat

Investing.com - Needham has maintained its Hold rating on Masimo Corp . (NASDAQ:MASI) following the company’s second-quarter 2025 financial results that exceeded analyst expectations. According to InvestingPro data, the company has demonstrated strong revenue growth of 16.68% over the last twelve months, though 5 analysts have recently revised their earnings expectations downward.

Masimo reported better-than-anticipated revenue and earnings per share for the quarter, while its overall revenue growth slowed to 7% on a constant currency basis, down from 10% in the first quarter of 2025.

The medical technology company improved its gross margin by 40 basis points year-over-year, while its operating margin increased significantly by 600 basis points compared to the same period last year.

Management has revised its 2025 guidance, slightly raising revenue projections and increasing its earnings per share forecast to reflect a reduced tariff impact of $0.25 per share, down from the previous estimate of $0.45-0.50.

Masimo has restructured its sales organization, decentralizing product specialists to work more closely with pulse oximetry representatives in each territory, though Needham maintains its Hold rating citing valuation concerns and potential slower future earnings growth resulting from significant cost reductions.

In other recent news, Masimo Corporation reported its second-quarter 2025 earnings, surpassing expectations with an earnings per share (EPS) of $1.33, compared to the anticipated $1.22. The company’s revenue reached $371 million, slightly exceeding the forecast of $368.64 million. This revenue figure represents a 7% year-over-year increase on a constant currency basis, aligning closely with consensus estimates of $369 million. Following these results, Jefferies raised its price target for Masimo to $170 from $158, maintaining a Hold rating on the stock. The price target adjustment was attributed to a lower impact from tariffs. These developments highlight the company’s performance and the subsequent analyst response.

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