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The medical info systems industry is thriving due to the growing demand for contactless services. The industry witnessed exponential growth during the pandemic era. Even in the post-pandemic period, remote healthcare, a paperless environment, and distant treatment all paved the way for digital services.

The medical info systems industry comprises companies that develop and market healthcare information systems. These companies offer software and hardware solutions to healthcare providers with secure access to real-time clinical, administrative, and financial data in a time-efficient manner.

Increased focus on patient satisfaction, security of patient data, and administrative cost control have increased the need for big data, 3D printing, blockchain, and artificial intelligence (AI). 

The Zacks-defined Medical Info Systems Industry is currently in the top 40% of the Zacks Industry Rank. Since it is ranked in the top half of Zacks Ranked Industries, we expect the consulting services industry to outperform the market over the next three to six months.

Near-Term Drivers

The medical sector is one of the major adopters of AI, which is currently being used to synthesize new compounds for drugs and create devices for more precise measurement and faster and more accurate diagnosis. One common application of AI has been in diagnostic settings, where it quickly and precisely detects image abnormalities that might be challenging for the human eye to spot.

Several medical device makers are also developing surgical robots with AI integration for complex and specialized procedures. Further, electronic health records, electronic medical records, predictive analytics, and real-time alerting have been gaining prominence.

AI systems have been successful in multiple medical imaging use cases, such as detecting mitosis in breast cancer histology images, classifying skin cancer with dermatologist-level accuracy, diagnosing diabetic retinopathy from retinal fundus photographs, and predicting cardiovascular risk factors from retinal fundus photographs.

Even though the height of the pandemic has passed, the need for contactless services is growing enormously. Within the medical information systems space, the telehealth and remote patient monitoring segments have continued to grow at a fast pace.

A Startech Up report in 2023 stated that the use of AI in healthcare is helping medical professionals in several ways. For instance, it is accelerating the diagnosis process and automating hospital workflows through robotics, AI-driven chatbots to check symptoms, and so on.

Our Top Picks

We have narrowed our search to five medical info systems stocks that have strong growth potential for 2024. These stocks have seen positive earnings estimate revisions in the last 60 days. Most of these picks boast a Zacks Rank#2 (Buy) rating.

The chart below shows the price performance of our five picks in the past month.

Image Source: Zacks Investment Research

Hims & Hers Health Inc. (HIMS - Free Report)

This company operates a telehealth platform that connects consumers to licensed healthcare professionals in the United States, the United Kingdom, and internationally. Hims & Hers Health offers a range of curated prescription and non-prescription health and wellness products and services available to purchase on its website and mobile application directly by customers.

Hims & Hers Health also provides prescription medication on a recurring basis, as well as ongoing care from healthcare providers, over-the-counter drug and device products, cosmetics, and supplement products primarily focusing on general wellness, sexual health and wellness, skincare, and hair care.

Hims & Hers Health has an expected revenue and earnings growth rate of 39% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 36.4% over the last seven days.

Butterfly Network Inc. (BFLY - Free Report)

This company develops, manufactures, and commercializes ultrasound imaging solutions in the United States and internationally. Butterfly Network Inc offers Butterfly iQ, a handheld and single-probe whole-body ultrasound system. Through its proprietary Ultrasound-On-Chip technology, Butterfly Network is paving the way for earlier detection and remote management of health conditions.

Butterfly Network Inc also provides a Butterfly system, which includes probes, and related accessories and software subscriptions to healthcare systems, physicians, and healthcare providers through a direct sales force, distributors, and eCommerce channel.

Butterfly Network has an expected revenue and earnings growth rate of 17.9% and 35.4%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 6.7% over the last seven days.

Enovis Corp. (ENOV - Free Report)

This next one operates as a medical technology company focused on developing clinically differentiated solutions worldwide. Enovis Corp. also manufactures and distributes medical devices that are used for reconstructive surgery, rehabilitation, pain management, and physical therapy. The company operates through the Prevention and Recovery, and Reconstructive segments.

Enovis has an expected revenue and earnings growth rate of 24.7% and 7.9%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.4% over the last seven days.

Pulmonx Corp. (LUNG - Free Report)

Pulmonx Corp. is a commercial-stage medical technology company that provides minimally invasive devices for the treatment of chronic obstructive pulmonary diseases.

Pulmonx Corp. offers its Zephyr Endobronchial Valve, a solution for the treatment of patients with hyperinflation associated with severe emphysema, and the Chartis Pulmonary Assessment System, a balloon catheter and console system with flow and pressure sensors that are used to assess the presence of collateral ventilation.

The company also offers the StratX Lung Analysis Platform, a cloud-based quantitative computed tomography analysis offering information on emphysema destruction, fissure completeness, and lobar volume to identify target lobes for the treatment with Zephyr Valves.

Pulmonx has an expected revenue and earnings growth rate of 21.3% and 0.3%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 8.4% over the last 30 days.

Definitive Healthcare Corp. (DH - Free Report)

This company provides software as a service (SaaS) healthcare commercial intelligence platform in the United States and internationally. Definitive Healthcare's SaaS platform provides information on healthcare providers and their activities to help its customers from product development to go-to-market planning, and sales and marketing execution.

The company's platform consists of various functional areas, such as sales, marketing, clinical research and product development, strategy, talent acquisition, and physician network management.

Definitive Healthcare has an expected revenue and earnings growth rate of 3% and 23.3%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 15.6% over the last 60 days.

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