Below is a story on the downgrade to buy. I spoke with their IR and she said that downgrade was primarily due to the fact that Spine-Tech did not take part in a prior correction in the medical devices market (a stupid reason, in my mind, to downgrade a company). She also noted that H&Q actually INCREASED their revenue projections. Whe reading the story notice the sentence: "While he believes Bak-L may become the most successful orthopedic product ever launched in the U.S. ..."
H&Q Cuts Spine-Tech To Buy From Strong-Buy On Price
NEW YORK (Dow Jones)--Hambrecht & Quist LLC analyst Robert Faulkner cut Spine-Tech Inc. (SPYN) to buy from
strong buy, said a source at the firm.
In a report, Faulkner said the downgrade is based on the fact that the company is now a less-attractive risk/reward tradeoff
after the recent correction in early stage medical device stocks.
Faulkner said he has no issue with the company's approach to the imminent launch of its Bak-L spinal fusion cage, which is
expected soon to receive Food and Drug Administration approval. While he believes Bak-L may become the most successful
orthopedic product ever launched in the U.S., he thinks sales estimates presented by other investment research firms are
aggressive.
Spine-Tech Chief Executive David Stassen attributed the drop in the company's shares to Faulkner's downgrade.
Spine-Tech's shares fell to as low as 18 3/4 before recovering slightly to 19 3/4, for a drop of 3 17/64, or 14.2%, on volume
of 275,900 shares. Average volume is 127,500.
Stassen said the company is training surgeons in the use of Bak-L. The company expects to have about 400 physicians
trained by the end of the year, about 100 of whom received training during earlier clinical trials, he said. |
