Tuesday, June 26, 2007

Spectranetics stockholders get their wish -- a higher price

Just two day after two frustrated stockholders called on directors of Spectranetics Corp. to sell the company or buy back stock to boost the company's stock price, shareholders got at least part of their wish -- a higher stock price.
Shares of the Colorado Springs-based medical laser manufacturer jumped to a four-month high on Thursday of $11.26, a price the stock matched again on Monday in trading on the Nasdaq Stock Market.
The gains were came after Piper Jaffray & Co. started research coverage of Spectranetics on Wednesday with an "outperform" rating. Suraj Kalia, a senior research analyst for Piper Jaffray, set a target price of $13 a share for Spectranetics, a level the stock hasn't reached since Oct. 30. He expects the company's revenue to more than double from $78 million this year to $162 million in 2011.
"We believe the excimer laser technology of Spectranetics can be used in over 500,000 procedures per year," Kalia wrote. "The company has slowly worked its way into practices around the country, and good word-of-mouth advertising has helped the sales ramp."
Lawrence McKinley, senior vice president for RBC Dain Rauscher in Boulder, said Spectranetics directors should hire an investment banker to sell the company, while Michael Norvell, first vice president for UBS Financial Services in Evergreen, said directors should spend some of the company's $53 million in cash to buy back up to 2 million shares.
Until Kalia's report, the stock had failed to respond to improving financial results, inlcuing a 47 percent jump in revenue last year to a record $63.5 million.

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