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Thoratec Could Fetch $65-$70 In Buyout, Predicts Northland's Suraj Kalia


In a report published Wednesday, Northland Capital Markets analyst Suraj Kalia maintained an Outperform rating on Thoratec Corporation (NASDAQ: THOR), with a price target of $55, amid speculations of the company being acquired by St. Jude Medical, Inc. (NYSE: STJ).

Bloomberg had reported of a possible THOR acquisition, with St. Jude Medical being the rumored buyer. Analyst Suraj Kalia believes that if such an acquisition does take place, it would value Thoratec at $65-$70 per share. This translates into a takeout value of about $3.5B.

"While this would represent approx 7x FY16 sales, we believe it does not factor in the significant potential from THOR's entry into the acute HF space, the share gains from launch of HM-III, and finally, any behind the curtain work being done on ECMO platforms," Kalia wrote.

In the report Northland Capital Markets noted that although Thoratec had "lost ground" in the VAD wars, the company's new CEO Keith Grossman seemed to have "shepherded the company well."

Kalia added that while the TET systems appear to be 3 years away, "St. Jude's CardioMems HF monitoring device combined with VAD therapy "could" allow for better patient management, reduced HF-related hospitalizations, and overall cost management."

Latest Ratings for THOR

Dec 2019JefferiesDowngradesBuyHold
Dec 2019SVB LeerinkDowngradesOutperformMarket Perform
Dec 2019Evercore ISI GroupDowngradesOutperformIn-Line

View More Analyst Ratings for THOR
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