3D Mammograms Mean Good Things For This Stock

• Hologic, Inc. HOLX has seen an almost 56 percent increase in its share price, year to date.
• Jefferies’ Raj Denhoy has maintained a Buy rating on the company, while raising the price target from $44 to $48.
• Denhoy believes that the increasing adoption of 3D Mammography and the company’s market share in this segment could provide upside potential to the stock.

A survey of 25 radiologists specializing in breast cancer revealed that Hologic’s 3D breast imaging technology had already been adoption by most practices, with the rest planning to “add additional capacity over next 1-3 years.”

Jefferies’ survey also revealed the company’s Genuis 3D to be the clear system of choice, “capturing 74 percent of future purchases.”

The survey also revealed that a majority of the early adopters of 3D Mammography has chosen Genuis 3D over other brands, with unit volumes also “heavily in favor of Hologic.” Denhoy expects the company’s share of the 3D Mammography market to be higher than the 60 percent share it holds of the 2D market.

Given that the penetration of the 3D market is only 15 percent and the survey suggesting that “the 3D cycle is in full swing with Hologic the clear winner in terms of share,” Denhoy stated, while raising the revenue growth estimate for the company for 2016.