KNSY: Management's F11 Forecast Surprisingly Strong After Solid FQ4
Analysts at Jefferies & Co maintain their "hold" rating on Kensey Nash (NASDAQ: KNSY), while raising their estimates for the company. The target price for KNSY is set to $21.
Jefferies & Co says, “KNSY reported F4Q:10 revenue and adjusted EPS of $21.9M and $0.54 which was slightly ahead of our estimates of $21.3M and $0.52 and Street consensus of $21.3M and $0.51. Total revenue in the period consisted of $15.1M (up 12% y/y) in net product sales, exceeding the company's $14.5M-$14.7M guidance, and $6.8M (down ~1.5% y/y) in royalty revenue, below the company's $6.9M-$7.1M guidance.”
“KNSY reiterated its FY11 guidance of $81.0M-$83M and issued adjusted EPS guidance of $1.86-$1.90, both slightly ahead of current Street expectations. The company's top-line guidance reflects $54M-$55.5M in net product sales and $27.0M-$27.5M of royalties, the former reflecting strong contributions from the pending ECM product launches in the US and EU, 2HF11 cartilage repair product launch in the EU, and growth in biomaterials, as well as being inclusive of the recently re-negotiated St Jude collagen supply agreement. We remain in the "wait and see" camp for performance on new products and believe that the new bar could prove to be a bit aggressive given our forecasted 75% decline in Angio-Seal component sales in F11. While the renegotiated STJ supply contract offers KNSY an optical reprieve, the terms of the new agreement make it clear that the STJ collagen supply agreement will soon come to an end (we suspect as soon as the 2012 contract anniversary as 2012's minimum steps down from 2011 levels),” the analysts add.
