Wells Fargo Downgrades Thoratec (THOR) to Market Perform; Market Softness And HTWR Momentum Dampen Near-Term Outlook

Wells Fargo downgraded Thoratec (NASDAQ: THOR) from Outperform to Market Perform, price target range of $27-$28 vs. $34-35.

Wells analyst says, "We believe (1) the LVAD market in the U.S. (66% of worldwide sales) was soft in Q4 2011 and this will result in a reduction in Street estimates for 2012 and beyond; and (2) THOR’s main competitor, HeartWare, appears to have regained momentum in the U.S. Preliminary results from 17 centers in our monthly LVAD survey indicate that the U.S. LVAD market and THOR’s HeartMate II declined year over year in Q4 2011 by 7% and 5%, respectively. This compares to our current U.S. LVAD market and HeartMate II estimates of +18% and +12%, respectively. To meet our THOR Q4 revenue estimate of $106MM (vs. consensus of $111MM), we estimate centers outside of our survey need implant volume to grow 8%."

"...The sample size of our survey is admittedly small, but we think it points to a weak market overall. In addition, there was a sequential increase in Heartware (Nasdaq: HTWR) implants in December which was broad based across the centers in our survey...

For an analyst ratings summary and ratings history on Thoratec click here. For more ratings news on Thoratec click here.

Shares of Thoratec closed at $30.13 yesterday.

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