Dougherty & Co Downgrades Hologic (HOLX) to Neutral; Four Reasons Not To Like The Deal
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Price: $76.01 --0%
Rating Summary:
6 Buy, 28 Hold, 0 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
6 Buy, 28 Hold, 0 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Dougherty & Co downgraded Hologic (NASDAQ: HOLX) from Outperform to Neutral, price target cut from $26 to $20.
Analyst, Junaid Husain, sees four reasons against the acquisition of Gen-Probe (Nasdaq: GPRO) including:
1) Possible Softness in the Base Business - We would have expected a healthier Breast Health business, given the Dimensions Tomosynthesis Year-2 rollout. Ultimately, we ponder whether the Gen-Probe transaction is a smoke-screen for a weaker base business;
2) We’re Not So Sure of the Synergies. Metaphorically speaking, we’re unsure how 1+1=5, as it pertains to this deal. We note that 35% of Gen-Probe’s business is blood screening (i.e., HIV, HBV, HCV, etc) and unrelated to Hologic’s core women’s health businesses. As such, we do not see opportunities to leverage the sales force across multiple product lines;
3) We See Gen-Probe As Cytyc, Part Deux. The Gen-Probe transaction reminds us of Hologic’s much heralded (and later harangued) acquisition of Cytyc Corporation in 2007; and
4) Intractable Case of Napoleonic Syndrome - Almost 5 years after Hologic’s frustrating Cytyc acquisition — and many more smaller deals later (i.e., Third Wave Technologies, Interlace Medical, Sentinelle Medical, Healthcome, TCT)—we’re wondering what Hologic has to show for these acquisitions from a growth and/or strategic perspective.
For an analyst ratings summary and ratings history on Hologic click here. For more ratings news on Hologic click here.
Shares of Hologic closed at $19.12 yesterday.
Analyst, Junaid Husain, sees four reasons against the acquisition of Gen-Probe (Nasdaq: GPRO) including:
1) Possible Softness in the Base Business - We would have expected a healthier Breast Health business, given the Dimensions Tomosynthesis Year-2 rollout. Ultimately, we ponder whether the Gen-Probe transaction is a smoke-screen for a weaker base business;
2) We’re Not So Sure of the Synergies. Metaphorically speaking, we’re unsure how 1+1=5, as it pertains to this deal. We note that 35% of Gen-Probe’s business is blood screening (i.e., HIV, HBV, HCV, etc) and unrelated to Hologic’s core women’s health businesses. As such, we do not see opportunities to leverage the sales force across multiple product lines;
3) We See Gen-Probe As Cytyc, Part Deux. The Gen-Probe transaction reminds us of Hologic’s much heralded (and later harangued) acquisition of Cytyc Corporation in 2007; and
4) Intractable Case of Napoleonic Syndrome - Almost 5 years after Hologic’s frustrating Cytyc acquisition — and many more smaller deals later (i.e., Third Wave Technologies, Interlace Medical, Sentinelle Medical, Healthcome, TCT)—we’re wondering what Hologic has to show for these acquisitions from a growth and/or strategic perspective.
For an analyst ratings summary and ratings history on Hologic click here. For more ratings news on Hologic click here.
Shares of Hologic closed at $19.12 yesterday.
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