Stifel ups Cynosure price target to $50

Stifel has raised its price target for Cynosure (NASDAQ:CYNO) to $50 from $44, reflecting revised estimates and an increased sales multiple due to the company’s higher growth rate. The stock closed at $42 on Monday.

Cynosure is a medical device company focused on designing, manufacturing, and marketing energy-based systems primarily for minimally invasive and non-invasive aesthetic procedures.

“Based on our recent bullish diligence for [Cynosure’s] SculpSure and to a lesser extent MonaLisa, we are raising our 4Q15, 2016, 2017, and 2018 revenue and EPS estimates,” writes analyst Jonathan Block.

“Our tracker shows solid uptake for Cynosure’s non-invasive body contouring SculpSure in the calendar fourth quarter, which is acting as the main impetus to our increased estimates,” he added.

Turning to 2016, Mr. Block said SculpSure and MonaLisa can combine for about $80-million in sales versus an estimated 2015 contribution of about $40-million. “Our 2016 revenue estimate is $386-million versus an estimated $338-million in 2015,” he said, adding that the incremental $48-million in sales reflects the SculpSure and MonaLisa contribution.

Mr. Block’s 2016 EPS estimate moves up to $1.32 from $1.29, representing 35%-plus year-over-year growth, “but we remain below consensus of $1.43 due to an ongoing S&M spend to support the two fast growing products.”

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