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David Turklay of JMP Securities initiated coverage on AxoGen (AXGN.OB) yesterday with a "BUY" rating and a price target of $8.

AxoGen Inc. is an growing regenerative medicine company focused on the commercialization of proprietary products and technologies for peripheral nerve reconstruction and regeneration. The company has had more than 7,000 surgical implants of its products performed in hospitals and surgery centers across the United States, including military hospitals that serve U.S. servicemen and women.

Turklay believes that the Company is "Hitting an inflection point" and values the company at $8 per share, which is based on an EV/Sales multiple of 5x on estimated 2014 revenues of $25 million; representing an 81% increase over his 2013 revenue estimate of $13.8 million.

His valuation is consistent with his analyst peers and inline with the take-out multiples of regenerative medicine companies that have been purchased by larger medical device companies, have been picked up within the ~5x to ~6x range.

Among the noteable purchases in this space was Royal DSM's (RDSMY.PK) purchase of Kensey Nash was purchased for ~5x sales, Shire's (SHPG) acquisition of Advance Biohealing at ~5.1x sales, Johnson & Johnson's (JNJ) purchase of Synthes for ~5.8x sales. The most expensive purchase was Kinetic Concepts acquisition of LifeCell for $1.7 billion, or ~8.5x sales.

Regenerative medicine continues to be a hot-bed of opportunity for investors. This is because larger med-tech companies with commoditizing products are in search of cutting-edge, high growth technologies to help bolster their top-line growth rates.

For AxoGen, peripheral nerve regenerative represents a pioneering opportunity for the company, which Turklay noted it as a "unique one-stop shop for peripheral nerve repair". AxoGen is the sole player in a peripheral nerve allograft market that is an estimated $1 billion opportunity.

Investors are becoming more aware of Axogen and it's products and business potential. It was recently highlighted on FOX Business News' Varney & Company and was written up in the Wall Street Journal. This has not only been positive for the Company's shares, which are up approximately 88% year-to-date, but more physicians and surgeons are being educated and introduced to the company's products, which will later translate in to improving sales growth.

Investors should keep watch on AxoGen shares.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Analyst Tao Levy of Loewen, Ondaatje, McCutcheon (LOM) initiated coverage on two companies today; AxoGen, Inc. (AXGN.OB) share with a BUY rating and a $5 price target and BioMimetic Therapeutics, Inc. (BMTI) With a BUY rating and a $7.50 price target.

AxoGen is an emerging player in the field of regenerative medicine, with a unique focus on the peripheral nerve repair market, which is estimated to be a $1 billion market opportunity.

According to Levy, demand for AxoGen's product portfolio, led by its Avance product, the only commercially-available nerve allograft, has grown significantly over the last 12 months, and he forecasts the Company will deliver 60+% yr/yr sales growth in 2012. The key drivers behind this performance have been the publication of positive clinical data, greater clinician awareness of Avance's benefits, and an expansion of AxoGen's sales and marketing efforts.

Levy also believes that AXGN's recent $20.8 million financing with PDL BioPharma (PDLI) removes a significant overhang that now allows the company to focus its efforts toward growing the business.

AXGN trades at a 2013 Enterprise Value (EV)/Sales multiple of 2.3x, which is an approximately 40% discount to peers which include: Anika Therapeutics (ANIK), Cytomedix (CMXI), Cardiac (CRDC), Cryolife (CRY), BioMimetic , Cytori (CYTX) and MiMedx (MDXG). Levy believes that AXGN current share prices, "does not adequately reflect the growth potential of AXGN's product portfolio." His price target of $5.00 is based on applying the average peer group multiple of 3.5x EV on his 2013 AXGN sales estimate of $14.5 million.

BioMimetic Therapeutics is a development-stage regenerative medicine company focused on the $1+ billion orthobiologics market. Its lead product candidate is Augment which is designed as an alternative to autograft in foot and ankle fusion surgery. The Company recently submitted an ammended PMA which Levy believes improves the Company's chances for receiving FDA approval.

BMTI shares has been under pressure as a result of a January 2012, non-approval letter from the FDA for its Augment product. In July 2012, the Company submitted a PMA application, which according to Levy, addressed all of the information requested by the FDA. Additionally, the Company's patient study, which includes 13,000 patients appears to have allayed carcinogenic concerns with a protein used in Augment.

Levy's $7.50 price target is risk-adjusted and reflects, "a 70% probability that our base case scenario (2H13 Augment approval) occurs and 30% probability for our bear case (2016)".

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

ALACHUA, Fla.--(BUSINESS WIRE)--AxoGen, Inc. (AXGN.OB) a leading regenerative medicine company dedicated to advancing the science and commercialization of peripheral nerve repair solutions, today announced that it will release its financial results for the period ended September 30, 2012, on November 7, 2012 after the close of U.S. financial markets. A conference call hosted by Karen Zaderej, Chief Executive Officer, and Greg Freitag, Chief Financial Officer, will follow at 11:00 a.m. ET, on November 8, 2012.

Conference dial-in: 877-709-8150

International dial-in: 201-689-8354

Webcast: www.axogeninc.com/investors.html

A webcast replay of the conference call will be available on the Company's website, www.axogeninc.com, under "Investors."

About AxoGen, Inc.
AxoGen (AXGN.OB) is a leading regenerative medicine company dedicated to advancing the science and commercialization of peripheral nerve repair solutions. AxoGen's products offer a full suite of surgical nerve reconstruction solutions including Avance® Nerve Graft, the only commercially available processed nerve allograft for bridging severed nerves, AxoGuard® Nerve Connector, a coaptation aid allowing for close approximation of severed nerves, and AxoGuard® Nerve Protector, a bioscaffold used to reinforce a coaptation site, wrap a partially severed nerve or isolate and protect nerve tissue. For more information, visit our website at www.axogeninc.com.

AxoGen is the parent of its wholly owned operating subsidiary, AxoGen Corporation. AxoGen's principal executive office and operations are located in Alachua, FL.

To receive email alerts directly from AxoGen, please click here www.axogeninc.com/emailalerts.html.

Contacts

COCKRELL GROUP
Rich Cockrell, 212-521-4138
investorrelations@thecockrellgroup.com
www.cockrellgroup.com
or
AxoGen, Inc.
Greg Freitag, 386-462-6856
Chief Financial Officer
InvestorRelations@axogeninc.com

www.axogeninc.com

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.