RBC Capital initiates Becton Dickinson stock with Sector Perform rating

Published 24/09/2025, 22:42
RBC Capital initiates Becton Dickinson stock with Sector Perform rating

Investing.com - RBC Capital initiated coverage on Becton Dickinson (NYSE:BDX) with a Sector Perform rating and a $211.00 price target on Wednesday. According to InvestingPro data, BDX currently trades at a P/E ratio of 33.9x, suggesting a premium valuation relative to its near-term earnings growth potential.

The research firm’s analysis comes as Becton Dickinson prepares for a significant corporate restructuring, with plans to spin off and merge its Biosciences and Diagnostics businesses with Waters in the first quarter of 2026.

RBC Capital notes that following this transaction, "New BD" will emerge as a "scaled, pure-play MedTech leader" positioned to deliver mid-single-digit growth through increased investments in high-growth markets.

The firm expects margin expansion aided by the company’s BD Excellence initiative, which should drive earnings growth, free cash flow, and positive shareholder returns over time.

Despite these positive long-term prospects, RBC Capital remains "on the sidelines" due to the pending transaction, a conservative initial fiscal year 2026 guidance with limited earnings per share growth until fiscal year 2027, and what it sees as better opportunities elsewhere in the medical technology sector.

In other recent news, Becton Dickinson reported its fiscal third-quarter earnings, exceeding market expectations. The company posted an adjusted earnings per share of $3.68, surpassing the forecasted $3.40, and achieved a revenue of $5.5 billion, slightly above the anticipated $5.49 billion. This strong financial performance led Piper Sandler to raise its price target for Becton Dickinson stock to $200 from $185, while maintaining a Neutral rating. Additionally, Becton Dickinson has partnered with Henry Ford Health to implement pharmacy automation technology. This collaboration will introduce the BD Rowa Vmax, a robotic storage and dispensing system, at Henry Ford Health’s hospital-based community pharmacies in Michigan. The technology aims to automate medication storage and retrieval processes, allowing patients to pick up prescriptions 24/7. These developments reflect Becton Dickinson’s continued focus on innovation and growth.

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