Boringly simple

Boringly simple

Considering all the wackiness that’s going on in the wacky world of diabetes it’s refreshing when a company actually executes. This thought came to mind when Becton Dickinson (NYSE:BDX) released fourth quarter and full year results this morning. BD is in the boring business of needles and syringes, a business that they dominate as today’s results clearly demonstrate.

While everyone else in diabetes, with a few notable exceptions, continues to fumble about like the Keystone Cops, BD continues to go about their business with incredible consistency. The company has learned from their past mistakes, i.e. entering the glucose monitoring business that a company doesn’t need to have whiz bang technology, something that is way cool to make money. Diabetic Investor was also pleased that the company recently decided to kill their CGM project.

Yes we know it would have been sexy to enter this market but this decision shows that management knows what the company is good at and more importantly what they are not good at. The wacky world of diabetes is filled with examples of companies who strayed from their core competencies only to experience failure.

Diabetic Investor is constantly amazed that some companies seem to believe just because they are good at one thing in diabetes they will be good at everything in diabetes. That just because they experienced success in one area that this success will automatically translate to another area even though they have no experience in this area. Sanofi (NYSE:SNY) is just the most recent example of this.

BD has a long and distinguished history in diabetes. They understand the market for needles and syringes better than anyone else and now seem content to, excuse the pun here, stick with what they are good at. There was a time when Diabetic Investor was worried that the company might stray from their strength and venture into unknown territories. Thankfully it appears they thought better of it, which to Diabetic Investor shows why they belong in the upper echelon of diabetes companies.

We’ve said it before and we’ll say it again the business of diabetes as wacky as it may be comes down to the ability to execute. To develop a comprehensive well thought out strategy and then execute on that strategy.  So kudos to BD nice to see a company in this wacky world a company not act wacky, to actually have a well thought out strategy and then execute on that strategy. BD’s business may not be sexy but sometimes boring is good and in BD’s case boring is very profitable.