Thoratec (THOR) 4% Accretive to St. Jude Medical (STJ) FY17 at $65/Share - Needham & Company

Needham & Company analyst Mike Matson weighed in on St. Jude Medical (NYSE: STJ) amid reports the company is in talks to acquire Thoratec (NASDAQ: THOR). The deal would be ~4% accretive to STJ's 2017E EPS assuming that STJ pays $65/share, the analyst said.

"We think that THOR is an attractive asset since it is the leader in the underpenetrated ventricular assist device (VAD) market and that it would fit well with STJ given STJ's increased focus on heart failure. Our quick math indicates that an acquisition of THOR would be ~4% accretive to STJ's 2017E EPS assuming that STJ pays $65/share (or a $3.3B EV), finances the deal with $1B of cash and $2.3B of debt, and achieves $30M of synergies over three years.

The firm maintained a Strong Buy rating and price target of $91.

For an analyst ratings summary and ratings history on St. Jude Medical click here. For more ratings news on St. Jude Medical click here.

Shares of St. Jude Medical closed at $76.57 yesterday.

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