Oppenheimer has become considerably more cautious on Boston Scientific Corporation (NYSE:BSX), but not cautious enough to abandon its bullish rating.
Analyst Suraj Kalia lowered the firm’s price target on Boston Scientific to $65 from $85 on September 21, ahead of the company’s quarterly results, while maintaining an Outperform rating. Kalia is also reducing Oppenheimer’s fiscal 2026 estimates, citing the impact of Boston Scientific’s eight-day cybersecurity disruption, and cutting fiscal 2027 estimates because of competitive pressures in left atrial appendage closure (LAAC) and electrophysiology (EP).
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The $20 price-target reduction puts two different issues in focus for BSX investors, which include the near-term effects of the cyberattack and the LAAC/EP competitive pressures Oppenheimer cited in lowering its FY2027 estimates.
Bull Case
Oppenheimer’s decision to maintain its Outperform rating despite cutting both its price target and estimates suggests the firm has not abandoned its broader positive view of Boston Scientific. There are also signs that the operational disruption from the cyber incident is no longer occurring. Boston Scientific identified unauthorized activity on certain systems on August 25, which resulted in a network outage that affected manufacturing and its ability to process and ship customer orders.
By September 9, however, the company said that manufacturing, order fulfillment, and shipping operations had been fully restored, with products moving through its distribution network at or above normal levels. Boston Scientific was continuing to work through orders that accumulated before and during the disruption.
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The company’s performance before the cyberattack also provides useful context. Boston Scientific generated $5.44 billion in second-quarter revenue, up 7.5% year over year on a reported basis and 7% organically, while adjusted EPS increased to $0.86 from $0.75 a year earlier.
Bear Case
The immediate problem is that the cyberattack was significant enough to derail Boston Scientific’s previous 2026 outlook. In a September regulatory filing, the company said the incident was likely to have a material impact on its third-quarter and full-year 2026 results. Boston Scientific consequently said it was unlikely to meet the sales-growth and adjusted EPS guidance it issued in July. The company expects to recover some affected revenue as it fulfills customer orders and reduces backlogs, but said the full financial impact was not yet known.
Kalia is taking a more specific view of that disruption, as Oppenheimer estimates that roughly 9% of Boston Scientific’s revenue-producing days were affected during the eight-day breach, leading the firm to further lower its FY2026 estimates. The longer-term concern in Kalia’s update is competition. Oppenheimer is also lowering its FY2027 estimates because of competitive pressures in LAAC and EP, two businesses where Boston Scientific was already seeing some softness in the second quarter.
Boston Scientific reported that WATCHMAN global sales grew 4.2% organically in fiscal Q2, but said the product underperformed expectations as the LAAC market slowed, primarily because of compounding clinical evidence affecting referral patterns. U.S. WATCHMAN sales grew 3% organically.
Electrophysiology grew 9.1% organically globally, supported by the company’s pulsed-field ablation portfolio. But U.S. EP growth was 3%, with Boston Scientific itself saying competitive pressures in the U.S. market partially offset growth from its PFA ecosystem. These figures give additional context to Oppenheimer’s decision to reduce its 2027 estimates, as the analyst’s concerns are not limited to the temporary effects of the cyber incident.
Conclusion
Oppenheimer’s $20 price-target cut separates Boston Scientific’s (NYSE:BSX) current risks into two buckets. The cyberattack has created an immediate financial hit significant enough for the company to withdraw confidence in its previous 2026 guidance, although operations have since been restored. Competition in LAAC and EP could prove more persistent, and that is now weighing on Oppenheimer’s expectations for 2027 as well.
The retained Outperform rating shows that Oppenheimer has not turned bearish on the shares, but the lower estimates and $65 target make the near-term thesis considerably more cautious. Boston Scientific plans to provide an updated operational and financial outlook for the remainder of 2026, incorporating the anticipated impact of the cyber incident, when it reports third-quarter results on October 28.
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This article is originally published at Insider Monkey.
