Stifel starts Viveve Medical at buy; PT $6

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Stifel launched coverage of Viveve Medical (NASDAQ:VIVE) with a “buy” rating and $6 price target. The stock closed at $3.36 on April 16.

Viveve is focused on development and marketing the Viveve system and the Geneveve procedure. The Viveve system includes a radiofrequency generator, single-use treatment tips, and other disposables. It is used in the Geneveve procedure, a non-invasive treatment of vaginal introital laxity.

“Our Geneveve diligence identifies a high level of patient satisfaction with the procedure, expectations for increasing utilization in the coming quarters, a compelling payback period for the physician (less than12 months), and about 83% of current users would recommend a colleague purchase Geneveve for their practice,” writes analyst Jonathan Block.

While the stock underperformed in 2017, he believes some of the company’s growing pains are behind them.

For example, Mr. Block said the VIVEVE II trial protocol was clearly more arduous than expected, but recently finalized, and enrollment will begin imminently. In addition, “we appear closer to catalysts, with a solid cadence of clinical data over the next 12-to-24 months (LIBERATE I/II, VIVEVE II) and significant gross margin expansion inching closer,” he added.