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Masimo Corp (MASI)
NASDAQ:MASI

Masimo (MASI) AI Stock Analysis

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Masimo

(NASDAQ:MASI)

Rating:57Neutral
Price Target:
$160.00
▼(-6.91%Downside)
The overall stock score of 57 reflects a combination of strong strategic moves and earnings performance, offset by technical weakness and valuation challenges. Strong cost management and strategic divestitures position Masimo well, while declining revenues and recent losses weigh on financial and valuation metrics.
Positive Factors
Financial Performance
MASI's 1Q25 revenue and EPS beat consensus.
Innovation
MASI is focused on taking share in growth markets, refreshing its installed base with next-gen technology, and bringing AI capabilities to its sensors.
Leadership
New CEO is focused on driving commercial excellence; building and retaining top talent; and innovation to improve patient care.
Negative Factors
Cybersecurity
Certain manufacturing facilities have been operating at less than normal levels due to a cyber attack on MASI's network.
Tariffs
Tariffs will result in a significant headwind to cost of goods sold.
Valuation Concerns
Analyst maintains Hold rating given MASI's valuation and concern that significant cost reductions may have compromised future earnings growth.

Masimo (MASI) vs. SPDR S&P 500 ETF (SPY)

Masimo Business Overview & Revenue Model

Company DescriptionMasimo Corporation develops, manufactures, and markets noninvasive monitoring technologies and hospital automation solutions worldwide. The company offers masimo signal extraction technology (SET) pulse oximetry with measure-through motion and low perfusion pulse oximetry monitoring to address the primary limitations of conventional pulse oximetry. It also provides Masimo rainbow SET platform that includes rainbow SET Pulse CO-Oximetry products that noninvasively monitor hemoglobin species, including oxygen saturation, pulse rate, perfusion index, pleth variability index, and respiration rate from the pleth; noninvasively monitor hemoglobin concentration, and carboxyhemoglobin and methemoglobin; monitor arterial oxygen saturation and acoustic respiration rate; and calculates oxygen content and oxygen reserve index. It offers SedLine brain function monitoring technology to measure the brain's electrical activity by detecting EEG signals; capnography and gas monitoring products comprising external plug-in-and-measure capnography and gas analyzers, integrated modules, handheld capnograph and capnometer devices, and capnography sampling lines; O3 regional oximetry for tissue oxygen saturation measurement; and hemodynamic monitoring solutions. Its Masimo Hospital Automation platform includes Patient SafetyNet, Patient SafetyNet surveillance, Kite, UniView, Replica, UniView : 60, and MyView. It offers connectivity devices; and nasal high flow ventilation and neuromodulation solutions. It provides its products through direct sales force, distributors, and original equipment manufacturers partners to hospitals, emergency medical service and home care providers, long-term care facilities, physician offices, veterinarians, and consumers; and non-medical/consumer products through e-commerce site, masimopersonalhealth.com. The company was incorporated in 1989 and is headquartered in Irvine, California.
How the Company Makes MoneyMasimo makes money primarily through the sale of its proprietary medical devices and systems, which include pulse oximeters, patient monitoring systems, and related sensors and accessories. The company generates revenue by selling these products directly to hospitals, healthcare providers, and distributors worldwide. Additionally, Masimo benefits from recurring revenue streams through the sale of disposable sensors and other consumables that are necessary for the ongoing use of its monitoring systems. The company may also engage in strategic partnerships and collaborations with healthcare organizations and technology firms to expand its market reach and enhance its product offerings. These partnerships can contribute to revenue through joint ventures, licensing agreements, and shared technological advancements.

Masimo Earnings Call Summary

Earnings Call Date:May 06, 2025
(Q1-2025)
|
% Change Since: 6.45%|
Next Earnings Date:Aug 12, 2025
Earnings Call Sentiment Neutral
Masimo's Q1 2025 earnings call highlighted strong financial performance and strategic moves, such as the divestiture of Sound United and leadership appointments. However, challenges such as new tariffs and a recent security incident present potential headwinds. Overall, the company demonstrates resilience and a strong position to manage these challenges.
Q1-2025 Updates
Positive Updates
Strong Financial Performance
Masimo's healthcare revenue for Q1 2025 was $371 million, a 10% growth on a constant currency basis, with EPS growth of more than 50%. Operating margin expanded by 750 basis points.
Successful Divestiture
Masimo reached an agreement to divest its consumer audio business, Sound United, allowing the company to refocus on its professional healthcare business.
New Leadership
Lisa Hellmann joined as the new Chief Human Resources Officer, bringing exceptional talent to help drive Masimo's growth.
Product Development and Strategy
Plans to upgrade existing sensors and create next-generation monitors enabled with AI-based advanced algorithms to further strengthen positions in pulse oximetry, capnography, hemodynamics, and brain monitoring.
Negative Updates
Tariff Challenges
New tariffs have been introduced, impacting operating margins by 210 to 250 basis points and EPS by $0.45 to $0.50. The projected $33 million to $37 million increase in cost of sales for fiscal 2025 due to tariffs.
Security Incident
An incident impacted Masimo's website and several systems, necessitating an ongoing investigation. However, it is not expected to impact guidance.
Loss from Discontinued Operations
Net loss from discontinued operations was $218 million, including an impairment charge of $295 million for the audio business.
Company Guidance
During Masimo's First Quarter 2025 earnings call, the company reported strong financial performance with healthcare revenue of $371 million, reflecting a 10% growth on a constant currency basis. Operating margins expanded by 750 basis points year-over-year, and the non-GAAP earnings per share saw a remarkable 56% increase to $1.36. The company maintained its fiscal 2025 revenue guidance at $1,500 million to $1,530 million, indicating 8% to 11% constant currency growth. Despite new tariffs, Masimo anticipates operating margins to be in the range of 25.5% to 26.4%, with earnings per share projected between $4.80 and $5.15, factoring in a $33 million to $37 million increase in cost of sales due to tariffs. Additionally, the company announced its decision to divest its consumer audio business, Sound United, and prioritize share repurchases with the proceeds, reinforcing its focus on its core healthcare business.

Masimo Financial Statement Overview

Summary
Masimo's financial statements indicate strong cost management with a solid gross profit margin; however, profitability is under pressure due to negative net income and declining revenues. The balance sheet is stable with moderate leverage, but profitability issues affect returns. Cash flow remains robust relative to income, yet negative free cash flow growth is a concern.
Income Statement
55
Neutral
Masimo's TTM (Trailing-Twelve-Months) performance shows declining revenue and negative profitability. The gross profit margin stands at 50.5%, indicating strong cost management relative to revenue. However, the net profit margin is negative due to substantial net losses, highlighting profitability challenges. Revenue has decreased from the previous year, suggesting potential demand or operational issues.
Balance Sheet
60
Neutral
The balance sheet reveals a moderate debt-to-equity ratio of 0.72, indicating balanced leverage. The return on equity is negative, reflecting the company's recent losses. The equity ratio is 41.3%, showing a decent level of equity financing. Overall, the balance sheet is stable but affected by recent profitability issues.
Cash Flow
65
Positive
Masimo's cash flow analysis indicates a mixed performance. The operating cash flow to net income ratio is positive, suggesting strong cash generation relative to reported losses. The free cash flow to net income ratio is also positive, highlighting efficient cash flow management despite the negative net income. However, free cash flow growth is negative, pointing to potential future liquidity constraints.
Breakdown
TTMDec 2024Dec 2023Dec 2022Mar 2022Mar 2021
Income StatementTotal Revenue
1.97B2.09B2.05B2.04B1.24B1.14B
Gross Profit
996.70M1.00B1.00B1.06B808.35M743.07M
EBIT
-222.60M-266.70M136.50M210.00M275.82M255.82M
EBITDA
-136.80M-158.70M236.70M355.20M310.86M293.77M
Net Income Common Stockholders
-494.50M-304.90M81.50M143.50M229.60M240.30M
Balance SheetCash, Cash Equivalents and Short-Term Investments
130.80M177.60M163.00M202.90M745.25M641.45M
Total Assets
2.29B2.63B3.04B3.21B1.89B1.71B
Total Debt
681.50M846.10M970.00M975.40M32.66M34.35M
Net Debt
550.70M668.50M807.00M772.50M-712.59M-607.10M
Total Liabilities
1.35B1.57B1.68B1.87B336.76M304.91M
Stockholders Equity
946.40M1.05B1.36B1.34B1.55B1.41B
Cash FlowFree Cash Flow
145.30M176.40M6.40M-26.80M229.82M131.01M
Operating Cash Flow
181.70M196.40M94.10M29.50M264.75M210.96M
Investing Cash Flow
-21.60M-51.20M-81.20M-1.06B-37.53M-82.79M
Financing Cash Flow
-146.90M-125.60M-57.10M520.30M-122.40M-54.31M

Masimo Technical Analysis

Technical Analysis Sentiment
Positive
Last Price171.88
Price Trends
50DMA
158.21
Positive
100DMA
166.47
Positive
200DMA
157.16
Positive
Market Momentum
MACD
2.69
Negative
RSI
64.13
Neutral
STOCH
91.08
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MASI, the sentiment is Positive. The current price of 171.88 is above the 20-day moving average (MA) of 159.06, above the 50-day MA of 158.21, and above the 200-day MA of 157.16, indicating a bullish trend. The MACD of 2.69 indicates Negative momentum. The RSI at 64.13 is Neutral, neither overbought nor oversold. The STOCH value of 91.08 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MASI.

Masimo Risk Analysis

Masimo disclosed 69 risk factors in its most recent earnings report. Masimo reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Masimo Peers Comparison

Overall Rating
UnderperformOutperform
Sector (54)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
RMRMD
85
Outperform
$36.98B28.3225.81%0.84%9.54%37.23%
70
Outperform
$14.34B27.1611.77%1.66%21.95%
ATATR
70
Outperform
$10.12B28.0315.15%1.17%0.34%17.27%
BDBDX
68
Neutral
$49.71B33.105.97%2.29%5.84%15.12%
TFTFX
58
Neutral
$5.43B38.703.48%1.11%0.29%-48.98%
57
Neutral
$9.32B116.65-23.93%-0.12%-713.82%
54
Neutral
$5.31B3.26-45.10%2.79%16.76%0.02%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
MASI
Masimo
171.88
47.71
38.42%
ATR
AptarGroup
151.60
7.36
5.10%
BDX
Becton Dickinson
172.51
-57.92
-25.14%
HOLX
Hologic
64.57
-8.33
-11.43%
RMD
Resmed
250.98
42.68
20.49%
TFX
Teleflex
123.27
-81.54
-39.81%

Masimo Corporate Events

Legal ProceedingsBusiness Operations and StrategyRegulatory Filings and Compliance
Masimo Addresses Cybersecurity Incident Risks
Negative
May 27, 2025

Masimo Corporation plans to engage with investors to reaffirm its financial outlook for fiscal 2025, as initially provided on May 6, 2025. The company is addressing a cybersecurity incident that may impact its operations, with potential legal, reputational, and financial risks, as well as possible regulatory inquiries and business disruptions.

The most recent analyst rating on (MASI) stock is a Buy with a $170.00 price target. To see the full list of analyst forecasts on Masimo stock, see the MASI Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Masimo Reports Strong Q1 2025 Financial Results
Positive
May 6, 2025

On May 6, 2025, Masimo Corporation announced its financial results for the first quarter of 2025, reporting a 10% increase in GAAP revenue to $372 million and a 56% rise in non-GAAP net income per diluted share compared to the previous year. The company also provided an updated outlook for fiscal 2025, anticipating non-GAAP revenue growth of 8% to 11% and addressing the impact of new tariffs with mitigation strategies, highlighting its strong market position and operational resilience.

M&A TransactionsBusiness Operations and Strategy
Masimo Sells Sound United to HARMAN for $350M
Positive
May 6, 2025

On May 6, 2025, Masimo Corporation announced a definitive agreement to sell its Sound United consumer audio business to HARMAN International for $350 million in cash. This divestiture supports Masimo’s strategic focus on its core professional healthcare segment, aiming to drive innovation and accelerate revenue growth. The transaction is expected to close by the end of 2025, subject to regulatory approvals, and represents a strategic step for HARMAN in expanding its audio business.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.