Skip to main content

Market Overview

Amid Headline Risk, Barclays Says St. Jude's Pipeline Underestimated

Share:

Barclays believes investors are underestimating St. Jude Medical, Inc. (NYSE: STJ)’s pipeline and growth potential in future periods as it is working to close its merger with Abbott Laboratories (NYSE: ABT) in the fourth quarter.

The brokerage noted that the merger synergies are conservative and the company says the allegations of Muddy Waters/Medsec that the allegations are without merit.

“Overall, we think that STJ is a good deal for ABT and a strategic fit, and that the STJ deal close in the 4Q and improvements in STJ's results next year can catalyze ABT's stock,” analyst Matthew Taylor wrote in a note.

Meanwhile, St. Jude reported third quarter EPS of $0.99 versus consensus $1.01 on revenue of $1.499 billion, slightly above consensus of $1.497 billion. The analyst says the results are “good enough” given top-line stability and low expectations for the company headed into the quarter.

“[G]iven continued strength in Neuro and AF, and improved growth in Cardio (which grew 12%, 17%, and 7% respectively), we expect STJ's top-line growth will turn around once STJ receives MRI labels for its pacers (2H16E) and ICD's/CRT-D's (1H17E),” Taylor noted.

Taylor has an Equal-Weight rating on the stock, with a price target of $83.

At time of writing, shares of St. Jude were up 0.76 percent to $79.30.

Latest Ratings for STJ

DateFirmActionFromTo
Jul 2016WedbushDowngradesOutperformNeutral
Jul 2016Leerink SwannDowngradesOutperformMarket Perform
May 2016BarclaysDowngradesOverweightEqual-Weight

View More Analyst Ratings for STJ
View the Latest Analyst Ratings

 

Related Articles (STJ)

View Comments and Join the Discussion!

Posted-In: Barclays Matthew Taylor Muddy WatersAnalyst Color Earnings News Short Sellers Analyst Ratings

Latest Ratings

StockFirmActionPT
CMRXHC Wainwright & Co.Maintains18.0
PZZAStephens & Co.Maintains115.0
SIMONeedhamMaintains100.0
STAACanaccord GenuityMaintains150.0
DGIICanaccord GenuityMaintains25.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
SPAC
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com