Boston Scientific Wants to be a Rock Star. But First, It Needs Some Stars.

2/3/11Follow @xconomy

Boston Scientific (NYSE:BSX) has been talking the talk of late. But its walk the past few years can be best described as a limp.

There’s no mistaking the company’s new-found bravado as CEO Ray Elliott, who succeeded Jim Tobin in 2009, attempts to infuse the company with some of the energy that made his previous tenure at Zimmer Holdings so effective.

During Boston Scientific’s investor meeting in November, its first in years, the Natick, MA-based company played Van Halen’s “Right Now” and Jesus Jones’ “Right Here, Right Now” over the loudspeakers.

At JP Morgan’s annual healthcare conference in January, Boston Scientific titled its presentation “Our Pipeline is no BS(X).”

Boston Scientific has made aggressive predictions about future profit growth and acquired several companies over the past few months, including Sadra Medical, Atritech, and Asthmatx.

But judging from the company’s fiscal 2010 earnings, released late Monday afternoon, Boston Scientific has a long way to go before it proves to anyone it’s a rock star. Annual sales fell five percent to $7.8 billion from $8.2 billion in 2009. The company’s core cardiac rhythm management and cardiovascular businesses dropped 10 and eight percent respectively.

The good news is that Boston Scientific posted top line growth in endoscopy, women’s health, and neuromodulation. But those businesses combined account for not quite a quarter of the company’s annual revenue.

But that’s the past. In Boston Scientific’s eyes, the future is extraordinarily bright. At the investor meeting, the company told analysts it can generate 11 to 12 percent compound annual earnings growth over the next four years, through a combination of … Next Page »

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