- Raymond James lowered the price target on AngioDynamics Inc (NASDAQ:ANGO) to $27 from $32 based on a 3.0x group multiple applied to the C23 revenue estimate.
- At 2.2x EV/sales, Raymond James believes ANGO is undervalued given its growth profile and expects the multiple to expand with continued execution, supporting the Strong Buy rating.
- The revenue momentum is real and will carry into F23 (guide of 8-10% growth), the analyst wrote. He views back-order fulfillment as a source of cushion in the guidance. The stock price reaction is a bit disappointing given the guidance.
- Related: AngioDynamics’ Q4 Top-Line Beats Street View, Issues Mixed FY23 Guidance.
- The analyst notes that hospital staff shortages are still an issue but likely did not curb revenue growth. Monthly volumes were similar throughout the quarter.
- ANGO feels comfortable with the demand profile, even in a recessionary environment.
- ANGO reduced the back-order to $8 million (from $11 million). This backlog may have some double-counting, but it’s not significant (~10%). The company’s anti-competitive lawsuit against Bard has been pushed to mid-September from early July, with low expectations.
- Price Action: ANGO shares are up 5.74% at $21.17 during the market session on the last check Wednesday.
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