Barclays Initiates Coverage On Life Science Tools & Diagnostics, Names Thermo Fisher As 'Top Pick'

Barclays analysts Jack Meehan and Matthew Taylor initiated coverage on the Life Science Tools & Diagnostics industry with a positive view on Tuesday.

“The industry's innovation has rewarded shareholders with impressive growth in-and-out of the cycle, where recent end-market data points suggest stable growth into 2015,” according to Meehan.

Coverage on Hologic, Inc. HOLX was initiated “with an Underweight rating and a $24 price target. Hologic's 3D mammography is the only FDA-approved system clinically proven to improve upon the accuracy of traditional mammography” and “the company is exposed to potentially improving hospital capex, as rising volumes have led to rising cash flow to pay for instruments.”

The firm initiated coverage on Illumina, Inc. ILMN “with an Equal Weight rating and $210 price target. Illumina is the leader in next generation sequencing (NGS), a market where we project 50 percent growth through 2018. The company's foundation is built upon genomics and building instruments that unlock the wealth of data included in human DNA, RNA and proteins.”

Coverage on Myriad Genetics Inc. MYGN was initiated with an Overweight rating and $50 price target and the firm saw “potential upside beyond our target as investors get better visibility into the company's diverse pipeline of organic opportunities.” The analysts noted that “Myriad has arguably the best track record of returning capital to shareholders through repurchase, and we expect the company to remain opportunistic given the recent pullback.”

The firm upgraded shares of QIAGEN NV QGEN from Equal Weight to Overweight and raised its price target to $28. “Although rising competition in the market for human papillomavirus (HPV) tests has compressed revenue growth since 2011, QIAGEN has reached an inflection point where we believe that 2015 should serve as a baseline for accelerating growth in molecular diagnostics,” according to the analysts.

Coverage on Thermo Fisher Scientific Inc TMO was initiated with an Overweight rating and the firm recommend it as a “Top Pick” and as its “core holding for exposure to innovation in healthcare” for the company’s “consistency of organic growth, consistency of management execution, consistency of capital deployment, and notably, consistency of shareholder returns.”