NEW YORK (AP) ¿ Shares of Varian Medical Systems Inc. rose Friday after a Citi Investment Research analyst raised his rating on the cancer therapy system maker's stock. Like many medical equipment companies, Varian's sales and its share price have been hurt by the U.S. recession and the global economic slump, which has caused hospitals to cut back on their spending. Varian's shares are down about 41 percent over the last year. Analyst Amit Bhalla said hospital equipment spending could be tight for another three to six months, but he said that difficulty is included in Varian's stock price, along with any risks from health care reforms. He upgraded the shares to "Buy" from "Hold," and raised his price target to $45. In afternoon trading, Varian Medical shares rose $1.94, or 5.1 percent, to $39.94. The stock has traded above $36, Bhalla's previous target price, for the last two weeks. The analyst said proposed reimbursement cuts to clinics might be reduced, and worldwide sales of radiation equipment should keep improving. He noted two contracts Varian announced on Thursday, including one in which the company agreed to supply $60 million in products to a proton therapy center in Sweden. Palo Alto, Calif.-based Varian said it hopes to book the order for that project before the end of September, which is the close of its fiscal year. It also announced a five-year, $25 million service agreement.
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