Boston Scientific’s Michael Mahoney gets early analyst approval

Johnson & Johnson’s (NYSE:JNJ) Michael Mahoney will begin leading Boston Scientific (NYSE:BSX) in October, first as president and then begin his tenure at CEO in November. Mahoney joins Boston Scientific at a challenging time, as the company struggles with limited growth in its heart device markets, which generate 70 percent of its total revenue. He will work to reinvigorate sales in the company, which has shown an annual net loss since 2006. The company is cutting about 5 percent of its workforce in order to reduce up to $275 million in costs.

The first set of first impressions have come from analysts, who are generally positive about Mahoney’s appointment.

Morgan, Keegan & Co.’s senior medical device analyst, Jan Wald, stated ’getting someone of that caliber’ is ’significant for the company.’ She added that Mahoney will face a challenge in finding growth to boost company revenue, but his market development and expansion experience at Johnson & Johnson will help him.

Jefferies analyst Raj Denhoy, meanwhile, agreed that Mahoney’s largest challenge will be in accelerating revenue growth, but pointed out that Mahoney has time on his side.

Leerink Swann analyst Rick Wise pointed out that Mahoney’s track record of experience leaves him uniquely poised to breathe fresh blood into the company. Wise said Mahoney was ’clearly among J&J’s up and coming next generation of leaders.’

Wells Fargo Securities analyst Larry Biegelsen, who stated that Mahoney is a solid choice for the position, wondered in a note to investors whether Mahoney’s prolonged and ’unusual transition’ would renew speculation of plans for Johnson & Johnson to acquire Boston Scientific in the future. The two companies have had a long-running feud.