Masimo Corporation (MASI): A Bull Case Theory 

We came across a bullish thesis on Masimo Corporation on HatedMoats’s Substack. In this article, we will summarize the bulls’ thesis on MASI. Masimo Corporation’s share was trading at $142.13 as of September 22nd. MASI’s trailing P/E were 75.96 according to Yahoo Finance.

Masimo Corporation (MASI) is a leading player in medical technology, best known for its Signal Extraction Technology (SET®) pulse oximetry platform, which has become the standard of care in hospitals worldwide. The company operates a razor-and-blade model where hardware placements drive recurring revenues from consumables, providing high visibility and stability. Its healthcare business generates the majority of revenues and cash flows, supported by deep integration into hospital workflows and high switching costs.

Consumables account for more than half of revenues, sustaining predictable margins and reinforcing customer stickiness. Masimo’s moat is underpinned by proprietary IP, regulatory approvals, and long-term hospital contracts, creating a durable competitive advantage that has been extended through adjacent non-invasive monitoring parameters.

Investor sentiment, however, remains cautious. Masimo has historically traded at a discount due to skepticism about management’s capital allocation and concerns over diversification moves such as the Sound United acquisition. Activist involvement and the recent divestiture of Sound United have helped refocus the business on its core healthcare franchise, but many investors remain wary, keeping valuation depressed relative to intrinsic strength. This disconnect underscores the “hated moat” profile—where a strong underlying business is not fully appreciated by the market.

Masimo’s moat is not without risks. Pricing pressure from Medtronic and group purchasing organizations could erode premium positioning, while Big Tech competition, particularly Apple, presents long-term substitution risk. Litigation outcomes and regulatory challenges add further uncertainty. Still, switching costs, embedded workflows, and clinical validation cycles provide durable protection. With recurring revenues, strong IP, and a refocused strategy, Masimo presents a compelling opportunity where investor skepticism contrasts with resilient fundamentals.

Previously we covered a bullish thesis on Medtronic plc (MDT) by Magnus Ofstad in May 2025, which highlighted the company’s transformation, strategic realignment, and potential value unlock via its diabetes spin-off and HUGO Robotic Surgery System. The company’s stock price has appreciated approximately by 17.27% since our coverage. The thesis still stands as MDT continues to expand margins. HatedMoats shares a similar but emphasizes Masimo’s consumables model and refocused core healthcare franchise.

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Disclosure: None.