An Insider Bought 30,000 Shares of Boston Scientific Corporation (BSX)

Other medical device companies include Medtronic, Inc. (NYSE:MDT), St. Jude Medical, Inc. (NYSE:STJ), Edwards Lifesciences (NYSE:EW), and Baxter International Inc. (NYSE:BAX). Edwards trades at a premium to the rest of these peers, at 21 times its trailing earnings, making it about even with Boston Scientific Corporation (NYSE:BSX) on that basis. Edwards did manage to grow its revenue by 8% last quarter compared to the first quarter of 2012, but we aren’t sure that a high enough growth rate to justify its current valuation. Medtronic, the largest of these companies by market cap at $50 billion, is priced at something of a discount with earnings multiples in the low teens. Growth has been low, but the company is at least somewhat close to value territory. St. Jude and Baxter both feature trailing P/E multiples of 17, with neither business showing much change in their financials in their most recent quarter compared to the same period in the previous year.

This insider purchase is interesting, but we wouldn’t recommend buying Boston Scientific at this time. The stock is overvalued relative to its current performance, and while we certainly wouldn’t rule out dramatic improvements at the company over the next couple of years expectations for 2013 are not particularly strong and we’d noted when looking at the Q1 results that there wasn’t any growth at all. Boston Scientific’s peers also generally look to be priced at about the right levels with little sign that the industry as a whole is poised for rapid growth.

Disclosure: I own no shares of any stocks mentioned in this article.