JMP resumes coverage of AtriCure

JMP Securities resumed coverage of AtriCure (NASDAQ:ATRC) with a “market outperform” rating and $25 price target. The stock closed at $14.39 on Wednesday.

“AtriCure is well positioned, in our view, to further develop and penetrate several large opportunities that are currently underserved in and around atrial fibrillation (AF),” writes analyst John Gillings.

“We believe that a disconnect between the share price and the ongoing solid performance of the business offers investors a good opportunity to build or add to positions at current levels,” he added.

While key end-markets are undergoing change, Mr. Gillings said the rate of change is overestimated by some in the market and that AtriCure will have time to grow and change with the market.

In addition, he pointed out that AF is a prevalent disease, is dramatically under-treated, and, similar to many opportunities in MedTech, demographic trends should provide a meaningful tailwind to volumes for the foreseeable future.

“Our $25 price target is based on 4-5 times EV/sales on our 2017 revenue estimate of $188-million,” he added.