Market Commentary

Michael Burgess Continues to Sell Stryker Shares

Matthew Levy, CFA · 1 minute read

Mr. Michael Burgess, who is representing Texas's 26th congressional district in the United States House of Representatives, disclosed last week that he has continued to offload shares of Stryker (SYK:US), a Michigan-based medical technologies corporation.

Rep. Burgess disclosed two $100,000 - $250,000 sales made on December 30 and January 03, when SYK closed at $244.49 and $246.03, respectively. Congressman Burgess was also selling some Stryker stock options last August when the stock was trading about 20% lower from current levels, as well as SYK shares in February of last year.

Similarly, Rep. Ro Khanna was also trading Stryker shares last year, including the sale of stock on October 20 when it closed at $214.44.

In the previous week, research firm KeyBanc initiated research coverage with a Sector Weight rating on Stryker, citing limited upside. Analysts are worried about the firm’s valuation which implies “above-average growth rate.” Hence, there could be a risk that Stryker shares could de-rate lower in the coming months in a risk-off environment.

Stryker reported in late October that its net sales increased 7.7% to $4.5 billion for its third quarter. However, the adjusted EPS decreased 3.6% to $2.12 while the adjusted operating income margin fell by 310 bps to 22.3%.

"We delivered strong organic sales growth in the quarter, despite product shortages and disruptions to full return of surgeries," said Kevin A. Lobo, Chair and CEO. "Worsening foreign currency and ongoing inflation, including premiums on spot buys for key components, pressured our adjusted earnings and will impact our full-year results. We are taking additional actions to address these persistent issues."

Stryker shares are up about 1.43% year-to-date (YTD) and trade about 2% higher from the levels at which Rep. Burgess was selling.