The San Diego-based developer of precision guided therapy tools, including intravascular ultrasound (IVUS) and fractional flow reserve (FFR) products, has achievable sales targets and a favorable valuation, analysts said.
"Our Volcano upgrade is based on three factors: august long-term sales growth targets are likely achievable (if not beatable), a more dedicated approach to margin expansion suggests a meaningful intermediate-term profitability ramp, and favorable valuation," analysts said.
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"We sense that Volcano is serious about profitability, assuming 3%, 6% and 9% EBIT margins in 2015, 2016, and 2017, respectively," analysts added.
Separately, TheStreet Ratings team rates VOLCANO CORP as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate VOLCANO CORP (VOLC) a SELL. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow, generally disappointing historical performance in the stock itself, generally high debt management risk and feeble growth in its earnings per share."