Dougherty & Co Starts AtriCure Inc. (ATRC) at Buy

Dougherty & Co initiates coverage on AtriCure Inc. (NASDAQ: ATRC) with a Buy rating and a price target of $25.00. Analyst Charley Jones noted accelerating growth, and he thinks the company is likely to be acquired.

"ATRC is the technology and market share leader of the surgical atrial fibrillation (AF) and Left Atrial Appendage (LAA) markets, which we estimate will grow to $500 million. ATRC also has two pivotal trials for the minimally invasive (MIS) treatment of AF and closure of the LAA, which are expected to be billion dollar markets over time," said Jones.

"AF patients have about a 6% annual risk of stroke, which is a five-fold increase versus non-AF patients. We believe ATRC will remain the market leader of the surgical AF and LAA markets for the foreseeable future. ATRC’s strong leadership position in the AF and LAA markets, the favorable competitive dynamics of its markets, the large number of individuals with AF, and the meaningful cost benefits to the overall healthcare system make ATRC one of the most attractive companies in the device industry. We believe an accelerating growth rate and larger revenue base should continue to lead to multiple expansion," continued the analyst

Jones added, "We believe ATRC is likely to be acquired for 4.5-6.0x forward revenue in the next few years. ATRC’s current growth profile (mid-teen growth), margin structure (70%+ gross margins) and future growth opportunities in its MIS markets deserve a premium revenue multiple."

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

Shares of AtriCure Inc. closed at $18.44 yesterday.

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