UPDATE - UBS Downgraded Thoratec (THOR) to Neutral; Stepping Aside; Still M&A Candidate, But Timing Hard to Predict

UPDATE - UBS downgraded Thoratec (NASDAQ: THOR) from Buy to Neutral. PT maintained at $34.

UBS analyst said, "Stepping aside as THOR approaches our price target: In the near-term, THOR stock trajectory may be driven primarily by FDA panel & launch of Heartware's (Nasdaq: HTWR) HVAD. We believe panel vote will be positive & that HVAD will gain share relatively quickly in larger centers. While THOR’s pipeline & LVAD market potential provide a basis for a constructive longer-term outlook, THOR may be range-bound as HVAD’s US launch plays out."

"M&A – still a valid candidate but timing hard to predict: As a result of shareholder actions, THOR will probably list assessment of strategic options on its proxy, which may then be voted on in May at THOR’s annual mtg. As 1 of 2 established competitors in the LVAD market, THOR does hold value for a strategic buyer while providing accretion at the EPS level (but not at the rev growth level). Buyers may be reluctant to step in ahead of HVAD approval." (We model 2013 sales / EPS of $454M / $1.53 (Street: $486M /$1.73).

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