Excerpt from our Wall Street Breakfast, a one-page summary of this morning's key market-moving and stock-moving stories:
Allergan, Mentor Buoyed by FDA Implant OK [TheStreet.com]
Summary: Silicone breast implant manufacturers Allergan and Mentor wasted no time heralding the FDA's Thursday approval of silicone breast implants. The "breast aesthetic" product had been under a production moratorium since 1992 due to safety concerns. The industry predicts a surge in demand for the implants, despite FDA warnings that "a woman will likely need additional surgeries on her breast at least once over her lifetime." Implants account for $54.1 million, or 7% of Allergan's total revenue in 3Q06. For Mentor, implants accounted for $58.2 million, or 87% of sales in 2Q06. Analysts forecast that the approval will have a greater impact on Mentor, it being smaller and less diversified than Allergan. Mentor shares reached $47.58 in regular trading, up $1.47, or 3.2%. They rose $5.42, or 11.4% in after-hours trading. Allergan shares closed at $112.50, climbing $1.76, or 1.6%. In after-hours trading, they increased $4.50, or 4%.
Related links: Press Releases: Mentor, Allergan. Media coverage: Wall Street Journal, Bloomberg. Commentary: What the Botox Boom Means for Allergan • Who Gains, Who Loses From the Bausch & Lomb Recall? .
Potentially impacted stocks and ETFs: Allergan (NYSE:AGN), Mentor (MNT) • Competitors: Bausch & Lomb (BOL), Johnson & Johnson (NYSE:JNJ) • ETFs: iShares Dow Jones US Pharmaceuticals (NYSEARCA:IHE), iShares Russell Midcap Growth Index (NYSEARCA:IWP), iShares Russell Midcap Index (NYSEARCA:IWR).
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