Supported by an aging population, higher rates of disease and increased business spending, medical device stocks command the attention of many investors. Furthermore, exciting advancements in artificial intelligence (AI) and high-powered analytics applications continue to push product development boundaries and drive innovation. Consulting firm KPMG predicts global annual sales in the medical device industry to reach almost $800 billion by 2030.

Strong fourth quarter earnings this week from industry-leading names such as Align Technology, Inc. (ALGN) and Stryker Corporation (SYK) have led several stocks in the space to break out above continuation patterns such as flags and pennants toward their 52-week highs.

Let's take a closer look at key technical levels for three medical device stocks on the verge of a 12-month breakout.

Abbott Laboratories (ABT)

Abbott Laboratories (ABT), with a market capitalization of $128.18 billion, develops, manufactures and markets medical devices, nutritional health care products, diagnostic equipment and generic pharmaceuticals. The company's fourth quarter (Q4) medical device sales led organic growth, with diabetes care, structural heart and electrophysiology revenue advancing 32.4%, 15.2% and 18.7%, respectively. Overall, the segment grew 9% in the quarter to $2.92 billion. Abbot stock offers a 1.79% dividend yield and is down 0.46% year to date (YTD) as of Feb. 1, 2019. Analysts have a 12-month price target on the stock at $79.55 – 9% above Thursday's $72.98 closing price.

Abbott's share price has traded within a 10-point range since October. Although still oscillating within the trading range, the stock has recently broken above a consolidation area resembling a flag pattern, suggesting that it wants to test the 52-week high at $74.57. If the price can't push through this level, look for a fall back to the long-term uptrend line that offers support at $67.

Chart depicting the share price of Abbott Laboratories (ABT)
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Edwards Lifesciences Corporation (EW)

California-based Edwards Lifesciences Corporation (EW) manufactures and sells medical devices and equipment to treat structural heart disease. Its principal products include surgical tissue heart valves, catheters and retractors, and monitoring equipment. The company generates roughly half of its revenue outside the United States. Edwards Lifesciences' Q4 net sales climbed 10% to $977.7 million, surpassing the Street's expectations of $976 million, although its outlook for the first quarter (Q1) fell shy of analysts' expectations. As of Feb. 1, 2019, the company's stock is up over 10% YTD, outperforming the medical devices industry average by 3.27% over the same period.

Edwards Lifesciences' chart shows a weak but steady uptrend over the past 12 months. The stock pushed slightly above a tight pennant pattern in Thursday trade that indicates an imminent run to the 2018 high at $175. Also, a relative strength index (RSI) reading below 70.0 gives the price plenty of room to move higher. Should price falter, bears may send the stock back toward $147.50, where it finds support from a long term trendline and the 200-day simple moving average (SMA).

Chart depicting the share price of Edwards Lifesciences Corporation (EW)
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Boston Scientific Corporation (BSX)

Boston Scientific Corporation (BSX) produces minimally invasive medical devices for blood clot filtration, cardiac rhythm management and structural heart disease as well as other specialty areas. The company, which has beaten earnings estimates in three out of the past four quarters, reports its Q4 results on Feb. 6, and it expects total year-over-year revenue growth of 6.3%, in line with consensus estimates. Full-year 2019 mean revenue growth is projected to be 14.4%. Boston Scientific stock, with a market cap of $52.79 billion, has returned nearly 8% this year as of Feb. 1, 2019.

After a moderate uptrend for the first nine months of 2018, Boston Scientific's share price slowly retraced back toward the 200-day SMA before starting its current leg higher in late December. The stock broke out from a pennant during yesterday's trading session and looks like it may test the 52-week high at $39.44 set in October last year. A stall here could see the price fall back to the $34 level, where it finds support from the 200-day SMA and a horizontal line connecting previous price action.

Chart depicting the share price of Boston Scientific Corporation (BSX)
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