Canaccord ups STAAR price target to $11

Canaccord Genuity raised its price target for STAAR Surgical (NASDAQ:STAA) to $11 from $9 following the company’s second quarter results. The stock closed at $10.55 on August 2.

Analyst Jason Mills, who said he was “warming up” to STAAR after the first quarter results, writes that “things got a little bit warmer coming out of the second quarter” as revenue topped his estimate.

Although year-over-year top line growth slowed slightly in the second quarter, compared with the first quarter, “we recommend investors shift focus from the rear view mirror, and begin to look forward to myriad growth opportunities that we believe STAAR is on the cusp of,” he added.

Mr. Mills cited FDA remediation and eventual lifting of a warning letter, potentially spring boarding the company into an era of robust clinical studies; an increasing number of product launches; and accelerating growth over the next two-to-three years.

“We take an increasingly constructive view on the stock, with management’s quality assurance improvements implemented in recent years setting the stage for future growth,” he added.

Based on current 2017 and 2018 estimates, Mr. Mills said he thinks the stock is fairly valued. “However, we expect management to outline 2018-2020 strategic priorities at STAAR’s investor day in November, potentially jumpstarting investor interest in the stock.”


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