Roth upgrades Cogentix Medical to buy

Roth Capital Partners upgraded Cogentix Medical (NASDQQ:CGNT) to “buy” from “neutral” and raised its price target to $2.20 from $1.25 after the company announced proposed equity financing and debt conversion transactions. The stock closed at $1.20 on Wednesday.

Analyst Chris Lewis writes that the transactions that would transform the company’s capital structure and significantly improve its net cash balance, leaving it much better positioned to maintain its market leadership position versus recent competitive entrants as well as become more opportunistic on the M&A front to add new sources of revenues over time.

“While we still have some concerns with MDT’s recent competitive launch and potential long-term reimbursement/pricing sustainability, we believe Cogentix has been successful on the competitive front thus far, and the proposed transactions leaves Cogentix much better positioned to maintain its PTNS OAB market leadership position going forward,” he added.