Zacks Investment Research upgraded shares of AngioDynamics Inc. (ANGO) from NEUTRAL to OUTPERFORM on December 01, 2014, with a target price of $21.00.
AngioDynamics reported an impressive first quarter of 2015, wherein both earnings and revenues beat the Zacks Consensus Estimate. The company provided a positive outlook for the second quarter and fiscal 2015. Adding to the positives, the company reiterated its long-term five year sales growth target at 10% and gross margin at 60%. Although a sluggish spending environment and the recent warning from the U.S. Food and Drug Administration (FDA) related to its Navilyst Medical facilities are headwinds, we believe that AngioDynamics' expanding product portfolio significantly enhances its market opportunities. Meanwhile, improving operating efficiency through consolidation of the New York distribution center and ERP implementation is expected to result in almost $15 to $18 million in cost savings, which will help AngioDynamics attain the gross margin target. We further believe that an innovative pipeline lends the company a competitive edge. Weighing the above factors, we upgrade our recommendation from Neutral to Outperform and set a price target of $21.00.
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