A 5 page paper providing a SWOT analysis and stock chart comparison of St. Jude Medical and its two leading competitors. St. Jude is contemplating introducing a new heart monitoring device. The paper assesses St. Jude’s position in its industry and likely health care provider, payer and patient acceptance to recommend that the company proceed with the introduction of the new product. Bibliography lists 6 sources.
St. Jude Medical, Medtronics and Guidant all have been successful within their industry. Each has achieved growth rates higher than industry average, and each produces devices important in cardiac
care. Both Medtronics and Guidant are better capitalized than is St. Jude Medical, giving them an advantage in the amount of investor capital available to them. The growth
of all three has been comparable, however, and the greatest difference in ratio comparisons is that St. Jude has been more conservative in categories such as capital spending. In
these difficult economic times, both Medtronics and Guidant maintain capital spending at rates higher than industry average, while St. Jude has reduced that cost category to a negative level.
The company recently entered into a joint venture with LifeScan, a Johnson and Johnson company. Together, the two companies promote the Harmony INR
Monitoring System developed by LifeScan. This device is an anticoagulation blood monitoring system consisting "of a handheld electronic monitor and disposable, single-use test strips" (New Devices, 2001). Figure
1. One-Year Stock Price Performance Source: Multex Investor SWOT Analysis Strengths * St. Jude Medical is well respected
in the industry. * The company is profitable and is well managed. * Its alliance with Johnson and Johnson gives it access to a wider market. Weaknesses * Lower market
capitalization makes the company more dependent on cash flow from operations. Opportunities * The health care industry continues to post ever-increasing growth. * St. Jude markets directly to health care
providers, relieving it of the responsibility of winning large numbers of non-repeat customers. * Third-party payers (i.e., insurers) support physicians orders for cardiac products and devices. Medicare reform could