St. Jude Medical (STJ +3.2%) enjoys lots of positive chatter following Friday's analyst day.
Stifel upgrades shares to Buy from Hold with a $75 price target, touting the company's pipeline that spans several businesses and targets new and existing markets; the firm is convinced STJ is poised to show steadily accelerating sales growth and expanding margins during the next 2-3 years, yielding above consensus top- and-bottom line numbers in the process.
Morgan Stanley says end-market stability and pipeline catalysts into H2 2014 suggest acceleration across the next several quarters; it reiterates an Overweight rating and $75 target.
BofA is out positive too, calling the stock a "best idea" and seeing several potential catalysts through the rest of 2014; the firm tags an $80 target price.
St. Jude (STJ +1.9%) estimates adjusted Q4 EPS of $0.97-0.99, with both ends of the range 2 cents above previous guidance. However, the figures exclude about $0.55 a share in charges, mainly related to restructuring and other corporate costs.
St. Jude also expects revenue to have risen to $1.42B from $1.37B.
Analysts project EPS of $0.96 and sales of $1.38B.
Sales breakdown: Cardiac Rhythm Management +3% to $705M; Atrial Fibrillation +5% to $252M; Cardiovascular +4% to $350M; Neuromodulation +2% to $115M.
St. Jude is due to give a presentation at the Annual JPMorgan Healthcare Conference in San Francisco at 11 PST. (PR)
Leerink is out with some commentary on the MedTech space.
Investors should "focus on companies with growth acceleration and/or upside surprise potential independent of (or at least less dependent on) a macroeconomic recovery [or, alternatively,] a higher and increasing percentage of sales derived from end-markets exhibiting above-average growth," Leerink says.
Not surprisingly, the LVAD device market gets a mention, with Heartware (HTWR) recommended by name (remember, they just snapped up CircuLite which some think can compete with SSH's C-Pulse).
Other names mentioned by Leerink: Covidien (COV) for neurovascular and energy devices; Stryker (SYK) for neurovascular and robotics; St. Jude's Medical (STJ) and JNJ for atrial fibrillation; Intuitive Surgical (ISRG).
Thoratec (THOR) gets an LVAD mention as well, which is interesting considering Leerink's recent commentary on the NEJM manuscript which discussed possible thrombus formation with the HeartMate II.
" Once positioned, the pacemaker is securely attached to the heart wall and can be repositioned if needed," says the company.
The race begins: In October, St. Jude Medical (STJ) purchased Nanostim, a private manufacturer of a similar device. Nanostim's offering is being readied for European markets, but has not yet won formal FDA approval, though it has been given additional approval through an exemption for "investigational" devices.
Medtronic's unit has been granted investigational status worldwide.
Bernstein downgrades St. Jude Medical (STJ -2.6%) to Market Perform from Outperform.
Analyst Derrick Sung still likes STJ's position in the CRM market, but with the stock up 60% YTD, doesn't see much in the way of multiple expansion going forward.
Specifically, Sung notes that the main components of the outperform thesis ("a lifting of the Riata/Durata overhang, a recovery in the ICD markets, and a reincarnation of the CardioMEMS opportunity") have "played out."
"Our Q3 results demonstrate that we are successfully implementing our program to accelerate sales growth on a sustainable basis," St. Jude Medical (STJ) CEO Daniel Starks says, regarding the company's MRQ performance.
Stripping out currency impact, STJ's Q3 sales grew 3% Y/Y.
On a segment-by-segment basis (currency neutral): CRM sales were essentially flat at $682M, AF sales rose 7% to $235M, cardiovascular sales jumped 4% to $317M, and neuromodulationsales were up around 3% to $104M.
Outlook: Q4 EPS of $0.95-0.97 on revenue of $1.315B-1.395B versus consensus of $0.96/share on sales of $1.39B. For the full year: EPS of $3.72-3.74 on sales of $5.394-5.474B against consensus of $3.72/share and revenue of $5.45B. (PR)
St. Jude Medical, Inc., develops, manufactures and distributes cardiovascular medical devices for global cardiac rhythm management, cardiovascular, atrial fibrillation therapy areas and neurostimulation medical devices for the management of chronic pain.