Masimo (MASI) Stock Forecast & Price Target

Masimo Corp's solid financial health is highlighted by a 7% year-over-year growth in its unrecognized contract revenue backlog, reaching $1.7 billion in the second quarter, signaling strong future revenue potential. The company anticipates recognizing $507 million of this backlog over the next 12 months, representing a 17% year-over-year increase, while management has reaffirmed a robust full-year constant currency revenue growth range of 8-11%. Furthermore, the company exceeded earnings expectations with an EPS of $1.33, driven by margin improvements and effective tariff mitigation strategies, which led to an upward revision of its adjusted operating margin and EPS guidance.

Masimo Corp's financial outlook is negatively impacted by a year-over-year decline in incremental new contracts, which dropped from $134 million in Q2 2024 to $80 million in Q2 2025, raising concerns over future growth potential within their key healthcare segment. The company also faces significant risks from tariffs, which resulted in a $5 million impact on Q3 sales, as well as potential delays related to product regulatory approvals, competitive pressures, and fluctuations in hospital demand for capital equipment. Additionally, the uncertainty surrounding the timing and magnitude of hospital contracts creates further unpredictability in Masimo's quarterly revenue performance, complicating their profitability trajectory.