Two recent events prove that Syneron-Candela (TICKER: ELOS), the leader in aesthetic medical devices, is trading at a deep discount to its universe. In fact, Syneron should trade not at its peer multiples but at a premium, for reasons detailed below. We initiate coverage on Syneron with a Strong Buy recommendation supported by 2 major transactions, and set a target price of $18. Syneron closed last night at $11.30 per share.
The first event occurred on December 6, 2013, when Lumenis filed for a $115 million IPO on NASDAQ. Lumenis is one of the main competitors of Syneron. The prospectus and the planned IPO clearly show how Syneron, the larger of the 2 companies, is trading at a...
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