Stryker Struggles With Chips

We have a client who works in the medical devices industry and he sent me an update from Stryker, who are struggling with chip shortages. Stryker has to bid for these chips through a broker, and that's crimping margins. They expect this to continue throughout the year.

Our client says his business is also suffering from the same problem. This is an ongoing issue for many industries that rely on semiconductor supply. My response was that challenges are normal. Stryker will weather the storm, margins may decline for a while but things will normalise next year. This is certainly not a reason to sell Stryker shares.

I was pleased that he agreed and said Stryker was a great bet in the industry. It is very rarely plain-sailing out there for big corporates. But it's their job to navigate around these obstacles.