January 6, 2026 (Global) – Financial services firm Raymond James has signalled a “quality tilt” in MedTech investing for 2026, upgrading Stryker Corporation to an *Outperform* rating while downgrading Zimmer Biomet to *Market Perform*. The move reflects a broader shift among analysts toward prioritising companies with consistent earnings growth and disciplined valuation, amid a sector that has lagged broader market performance.
According to Raymond James, Stryker stands out as one of the strongest compounders in the medical technology group over the past five years due to steady revenue and earnings execution. The brokerage said MedTech’s relative underperformance versus the broader market was exacerbated in the second half of 2025 after tariffs were introduced, pushing expected earnings growth into 2026.
“We see a preference developing for MedTech companies that can grow earnings organically without relying on multiple expansion,” the firm noted, underscoring confidence in firms like Stryker, Boston Scientific, Edwards Lifesciences and Intuitive Surgical that exhibit strong execution fundamentals.
Key Highlights of the Analyst Shift
- Raymond James upgrades Stryker to Outperform, citing consistent growth and execution.
- Zimmer Biomet is downgraded to Market Perform due to uneven growth prospects.
- MedTech has underperformed broader markets in 2025, partly due to tariff impacts shifting earnings growth expectations.
- The brokerage expects resilient procedure volumes and modest organic growth (~7%) in large-cap MedTech in 2026.
- The “quality tilt” emphasises fundamentals over broad sector exposure in MedTech investing.
Industry analysts view the Raymond James repositioning as a validation of sector differentiation, where firms with strong balance sheets, predictable earnings and targeted innovation are favoured in a cautious growth environment heading into 2026.
