Citi on October 8 reaffirmed Abbott Laboratories (ABT) and Dexcom (DXCM) as its two top picks in the medical technology sector. According to Sina Finance, Citi said growth within the sector is diverging, with continuous glucose monitoring business becoming a key factor for valuations and earnings prospects.

For Abbott, Citi said the investment case centers on low market expectations and the potential for growth to reaccelerate. The bank noted that Abbott's continuous glucose monitoring business is the key variable for its future performance, with first-quarter sales reaching $2 billion, up 7.5% from a year earlier. Management had previously said second-quarter growth would return to double-digit levels.

Citi said Abbott could see a re-rating if CGM growth accelerates again, especially given its currently depressed valuation. Abbott recently raised its full-year adjusted earnings-per-share guidance, and Rothschild Redburn upgraded the stock to Buy, citing strength in its medical devices business.

For Dexcom, Citi said the company has already shown clearer operating improvement through revenue growth, margin expansion and market share gains. Dexcom's shares are up about 35% this year, reversing a 14.7% decline for all of 2025. In the second quarter of 2026, revenue rose 13.1% to $1.308 billion, with organic revenue up 12% and international revenue up 19%. Gross margin improved by about 400 basis points, or 4 percentage points.

Citi also said Dexcom has continued expanding coverage for patients with type 2 diabetes and is promoting its next-generation G7 15 Day glucose sensor. After reporting second-quarter results, the company raised its guidance for a second straight quarter, and several brokerages later lifted their price targets.

Beyond Abbott and Dexcom, Citi also sees upside in Edwards Lifesciences, Sight Sciences and Zimmer Biomet. By contrast, it remains cautious on Boston Scientific, which has lowered guidance and said a cyberattack will prevent it from meeting its original targets.