Analyst David Lothson says Boston Scientific announced first-quarter preliminary global Taxus stent sales of $215 million, well ahead of its February guidance of $150 million to $180 million. He says outperformance is due to U.S. Taxus sales tracking ahead of expectations. Based on this report, Lothson says he now has higher confidence in his earnings and sales forecasts.
He estimates every $125 million in Taxus sales translates into 1 cent earnings per share. If sales trends continue to be robust, Lothson says his $1.70 2004 earnings per share estimate could prove conservative. At 18 times his 2005 earnings per share estimate, the stock trades at a nearly 20% discount to the cardiovascular-device group. He has a $54 12-month target.