Piper Sandler recommends immediately buying two outstanding healthcare technology stocks.

Investing.com — Medical Technology (MedTech) stocks have faced significant pressure in recent years. Piper Sandler analysts believe that a turnaround in this sector may still take several quarters, likely coinciding with a slowdown in the U.S. economy.

Despite the challenging environment, the firm has identified some favorable factors supporting certain stocks, including cyclical consumer exposure, strong free cash flow generation, and low leverage.

Against this backdrop, Piper Sandler recommends investors focus on large-cap companies within the MedTech sector.

The firm’s macro team notes that cyclical and value stocks are currently favored, and companies with strong balance sheets, solid free cash flow, and dividend yields are also attracting attention.

Several stocks with these characteristics have performed well so far this year, making them top holdings in the current market environment.

DexCom

Piper Sandler has a buy rating on DexCom stock, with a target price of $75, based on approximately 6 times the enterprise value to estimated sales for fiscal 2026. This valuation assumes about $758 million in net cash and approximately 391 million fully diluted shares outstanding.

The company aligns with the firm’s preference for large-cap stocks and has performed strongly this year. Main risks include regulatory approval challenges, competing products, and reimbursement pressures.

Recent news shows Dexcom reported Q4 2025 revenue of $1.26 billion, exceeding analyst expectations. The company also announced the appointment of Google executive Rick Osterloh to its board.

Steris

The firm maintains a buy rating on Steris, with a target price of $300, based on approximately 25 times the estimated earnings per share of $11.98 over the next twelve months.

Steris fits Piper Sandler’s preference for large-cap stocks in the current market environment and exhibits favorable features, including a strong balance sheet and free cash flow generation.

Risks for this stock include sensitivity to surgical volume, supply chain and inflation pressures, and potential fluctuations in capital equipment purchasing patterns.

Recent updates show that Steris reported third-quarter fiscal 2026 results, with revenue exceeding expectations by about 1%, and profits meeting market consensus. The company also announced a quarterly dividend of $0.63 per share.

Both recommended stocks possess characteristics that Piper Sandler considers advantageous in the current environment, making them top holdings within its broader MedTech coverage to help investors navigate ongoing headwinds in the sector.

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