Barclays Lowers Price Target on Hologic (HOLX), Slow Volume Recovery and Adoption of Tomo Units

Barclays is maintaining its Equalweight rating on shares of Hologic (NASDAQ: HOLX), but is lowering its price target from $21 to $20 as volumes have not recovered as fast as anticipated.

The company reported strong Q3 results with $451 million in revenue and EPS of $0.32. As a result of the solid quarter and market trends, HOLX increased its FY11 revenue guidance from $1.76-$1.77 billion to $1.77-$1.78 billion.

HOLX reiterated initial expectations for 5-700 orders in the first two years, with the majority being new units vs tomo upgrades.

An analyst at Barclays comments, "Managing tomo expectations: Despite high customer interest, visibility is limited on the conversion of interest to orders. As the trend accelerates towards the Dimensions line, HOLX will see higher ASPs and margins, as well as lock-in a future 3D installed base, while accelerating turnover of existing digital systems."

For more ratings news on Hologic click here and for the rating history of Hologic click here.

Shares of Hologic closed at $18.05 yesterday.

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