On Apr 11, we upgraded
), a leader in mechanical circulatory assistance devices to
Neutral, based on its prospects. The company is expected to
report first quarter 2013 results toward the end of Apr.
Why the Upgrade?
Revenues for Thoratec rose 17% year over year to $128 million
in the fourth quarter, beating the Zacks Consensus Estimate of
$119 million. Its fourth-quarter 2012 adjusted earnings per share
of 34 cents narrowly beat the Zacks Consensus Estimates of 33
cents. Thoratec has reported positive earnings surprises in three
of the last four quarters with an average surprise of 13.9%.
Over the last 90 days, the Zacks Consensus Estimate for 2013
has advanced by 2.5% to $1.67 while the same for 2014 has inched
up 0.5% to $1.98 over the same timeframe.
Thoratec's monopoly in the U.S. market, in the case of the
bridge-to-transplant ("BTT") therapy, has come to an end. It
followed FDA approval, in November 2012, for Heartware
International's (HTWR) Ventricular Assist System as a BTT for
patients with end-stage heart failure. Thoratec still enjoys
pre-eminence in the U.S. in the Destination Therapy ("DT")
market. Thoratec faces no near-term competitive threat in DT as
the HeartWare device is not expected to be launched in the near
Thoratec has a proven track-record in R&D. The company is
currently developing its next generation HeartMate III. Thoratec
accomplished first human usage of HeartMate Percutaneous Heart
Pump (HeartMate PHP) in Mar 2013. Next generation HeartMate
devices under development will be less invasive and easier to
implant. However, lack of pipeline visibility and relative lack
of milestones represent concerns.
Other Stocks to Consider
Thoratec carries a Zacks Rank #3 (Hold). We are more
Given Imaging Ltd.
), each of which carry a Zacks Rank #1 (Strong Buy) and are
expected to do well.
CEPHEID INC (CPHD): Free Stock Analysis
CYBERONICS INC (CYBX): Free Stock Analysis
GIVEN IMAGING (GIVN): Free Stock Analysis
THORATEC CORP (THOR): Free Stock Analysis
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