Piper Jaffray Rates Endologix Overweight, Thinks Nellix Aneurysm Treatment Is 'Highly Approvable'

Piper Jaffray provided its outlook on Endologix, Inc. ELGX on Wednesday, maintaining an Overweight rating and $15 price target.

Endologix announced 2Q16 revenues of $51.0 million, beating the consensus estimate of $46.3 million and raising its FY16 guidance to $197-203 million from prior $192-202 million. Management attributed the strength in the quarter to the European launch of a new version of Nellix at the Charing Cross meeting in April and better than planned execution from the merged Endologix + TriVascular sales forces in the US, along with the continued US launch of AFX2.

"New guidance implies a step-up in growth into 2H16 driven by continued strengthening trends in the US (including the continued cross-training of the sales force on the TriVascular Ovation platform – now ~50% complete) and the ongoing next-gen Nellix launch in Europe along with the planned launch of AFX2 in 3Q16," wrote Piper Jaffray.

The $15 price target is based on the 6.0x revised FY17 EV/revenue estimate of $215.3 million.