Canaccord Genuity Cuts Price Target on St. Jude Medical (STJ) Following In-Line 3Q Results

Canaccord Genuity maintained a Sell rating on St. Jude Medical (NYSE: STJ), and cut the price target to $59.00 (from $64.00), following the company's 3Q15 earnings results. While Q3 top- and bottom-line performance was largely in line with expectations, there was notable weakness in several key elements of the business, raising forward growth and margin concerns.

Analyst Jason Mills commented, "We reiterate our bearish stance on STJ on the heels of underwhelming Q3 results, guidance reduction, and increasing concern about STJ’s competitiveness near term in CRM and its ability to ramp CardioMEMS revenue to meet consensus’ bullish estimates for 2016, not to mention an increasingly opaque P&L (specifically widening gap between GAAP to “pro forma” earnings) that is even more difficult for the Street to model after the Thoratec acquisition. Consequently, when all models are published post Q3, we will likely see a very wide range of estimates for 2016 pro forma EPS, let alone GAAP EPS. We recommend under-weighting STJ in large-cap portfolios."

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 $62.30 yesterday.

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