A Foolish Baby Shower: Stryker

I have no idea what the world will look like in 18 years' time. Heck, if those Mayan astrologers are right, there won't even be a world in 18 years' time. But let's just assume for a moment that they ate the wrong mushrooms and were a bit off on their prognostications.

Whatever the world of 2024 may look like, I'm willing to bet on a few related themes -- there will be a lot more older people, their joints will be in bad shape, and they won't be content to sit in rocking chairs and just put up with it. In my mind, then, that all spells opportunity for leading orthopedics player Stryker (NYSE: SYK  ) .

Stryker does a little bit of everything. It makes replacements for worn-out and damaged hip and knee joints, it makes products in the trauma and spinal markets, and it has a sizable non-orthopedic medical equipment business as well. It also happens to have an enviable record of consistent profit growth.

What I really like, though, is that people are skeptical right now about the orthopedics industry. No, they're not worried that some new drug or device is going to take hip and knee business away from companies like Stryker, Zimmer (NYSE: ZMH  ) , and Biomet (Nasdaq: BMET  ) . What they're worried about is pricing -- hospitals and government officials are presently taking aim at the high cost of the implants and are looking to hold the line on further increases.

Over the course of the next few years, I expect this matter to find some resolution -- and that resolution isn't likely to be against the long-term interests of the orthopedics companies. Simply put, people need (and want) ever-better orthopedic technology, and the companies know that. So while they might not be able to raise prices quite as much as they have in the past, I have minimal worries that the sector in general, and Stryker in particular, will be unable to continue to produce excellent returns on capital.

So Stryker is a stock that I would, in fact, be comfortable buying for my niece or nephew with the intention that it would be held for at least 18 years. Whether or not the tyke's grandparents and/or uncle have some of Stryker's gear in their bodies, I'm sure he or she will be happy to have the stock when 2024 rolls around.

A joyful abundance of Foolishness awaits your little tyke. Click here to see what other financial gifts are in our Foolish baby shower basket for your littlest loved ones.

Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).


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