St. Jude Medical, a healthcare product manufacturer based in St. Paul, Minnesota, announced that its board of directors approved a new program to repurchase up to $1 billion in company shares. The repurchasing program was created in direct response to the company’s negative stock price performance in the past few months.
Since October 17th, St. Jude Medical’s stock price has decreased by approximately 22 percent. On this date, CEO Daniel Starks issued a warning to investors on potential problems with one of the company’s manufacturing plants. When the United States FDA released a very negative report on the Sylmar, California plant, shares of the company decreased approximately 10 percent. The FDA report detailed 11 significant problems at the plant. This plant manufactured leads for St. Jude Medical’s Durata pacemaker.
In a press release, CEO Daniel Starks said, "This share repurchase program demonstrates the confidence our board and management team have in the long-term prospects for St. Jude Medical. We remain committed to delivering superior results and value to our shareholders.”
According to analysts at a research division of Citigroup, the company may pull the Durata leads from the market. This could lead to a potential investment downgrade with analysts. Rival companies like Medtronic and Boston Scientific may receive upgrades from credit rating firms if the company pulls this product line.
- Additive Manufacturing 101: How the Future of Product Development and Manufacturing is Changing - Video
- Microfluidics—A Powerful Technology for Diagnostic and Medical Product Development - Video
- Going Beyond Colour Matching . - Video
- Metal Injection Molding(MIM) for Precision metal components manufacturing - Supplier Resource
- Usage Temperatures of Piezoceramic Materials - Supplier Resource
- Breaking the Rules – Design Ideation and Innovation - Supplier Resource