Masimo Corp (MASI, Financial) has experienced a notable fluctuation in its stock price recently. With a current market capitalization of $7.58 billion, the stock is trading at $143.23. Over the past week, Masimo's shares have declined by 3.22%, yet looking at a broader timeframe, the stock has gained an impressive 16.56% over the past three months. When compared to the GF Value of $221.57, the stock appears to be significantly undervalued, a sentiment echoed by its past GF Value of $261.54. This suggests that despite recent losses, the stock's overall trajectory has been positive and may indicate a potential buying opportunity for value investors.
Introduction to Masimo Corp
Masimo Corp, operating in the Medical Devices & Instruments industry, is a global technology company with a focus on the development, manufacture, and marketing of noninvasive patient monitoring technologies. The company's healthcare segment, which is the primary revenue driver, offers hospital automation and connectivity solutions, remote monitoring devices, and consumer health products. Additionally, Masimo's non-healthcare segment includes a consumer audio business that develops and markets premium and luxury audio sound products. 
Assessing Masimo's Profitability
Masimo Corp boasts a strong Profitability Rank of 9/10, indicating a high likelihood of the company maintaining its profitability. The company's operating margin stands at 8.02%, which is better than 61.32% of 817 companies in the same industry. Additionally, Masimo's return on equity (ROE) is 6.16%, surpassing 62.82% of its peers. The return on assets (ROA) at 2.65% and return on invested capital (ROIC) at 6.13% also place the company in a favorable position compared to 61.18% and 65.9% of industry competitors, respectively. Notably, Masimo has maintained profitability for the past 10 years, a feat better than 99.83% of companies in the industry. 
Growth Prospects of Masimo
The Growth Rank for Masimo is an impressive 9/10, reflecting the company's strong revenue and profitability expansion. The 3-Year Revenue Growth Rate per Share is a robust 24.30%, outperforming 82.3% of 740 companies in the industry. Similarly, the 5-Year Revenue Growth Rate per Share is 22.30%, surpassing 83.68% of its peers. However, the company's future revenue growth rate is estimated at a more modest 5.07%, which is still better than 29.55% of the industry. Despite these strong revenue figures, the 3-Year EPS without NRI Growth Rate shows a decline of 21.20%, and the 5-Year EPS without NRI Growth Rate also decreased by 10.20%. These figures suggest that while Masimo's revenue is growing, earnings per share have faced challenges. 
Key Shareholders in Masimo
Notable investors in Masimo include Steven Cohen (Trades, Portfolio), who holds 516,356 shares, representing a 0.98% stake in the company. Baillie Gifford (Trades, Portfolio) and Mario Gabelli (Trades, Portfolio) are also significant shareholders, with 86,188 and 84,500 shares respectively, each holding a 0.16% share. These investors' commitments to Masimo reflect confidence in the company's long-term value proposition.
Competitive Landscape
When compared to its competitors, Masimo holds its ground with a market cap of $7.58 billion. Close competitors include Globus Medical Inc (GMED, Financial) with a market cap of $7.1 billion, Penumbra Inc (PEN, Financial) at $8.56 billion, and Inspire Medical Systems Inc (INSP, Financial) at $7.08 billion. These companies, all within the same industry and with similar market capitalizations, provide a context for evaluating Masimo's performance and market position.
Conclusion
In summary, Masimo Corp's stock performance has been a mixed bag with short-term losses but significant gains over the past three months, indicating a potential undervaluation according to GF Value. The company's strong profitability and growth ranks, coupled with its consistent profitability over the past decade, paint a picture of a solid investment. However, the decline in EPS growth rates suggests areas for potential concern. With significant shareholders maintaining their stakes and a competitive position within the industry, Masimo Corp remains an intriguing prospect for value investors looking for opportunities in the medical devices sector.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
