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After 15 years of phenomenal growth that saw shares of Varian Medical Systems soar 43-fold from 1990-2005, the stock took a break the past two years, but Barron's says the upward trend is set to resume. Despite increased competition that took a toll on Varian's earnings, Barron's says indications are that the maker of radiology machines for cancer treatment has held on to just about all of its 50%+ market share. The problem, many say, has been a general market decline in hospital orders due to rising interest rates and mergers in the healthcare sector. CEO Tim Guertin says, however, that most of those orders "were delayed, not canceled," and one analyst says they "will soon be made up." Barron's says the company will be re-energized next year by an improving sales environment and robust product line. At $41.17/share, down from a 52-week high of $56, that analyst calls the stock "seriously undervalued" and says it could jump 25% back to that high over the next year.

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Source: Varian Poised for Rebound - Barron's