Analyst Kate Sharadin tells S&P MarketScope that Regeneration Technologies is her top pick for medical technology stocks to own going into 2005. She expects several catalysts for 2005, including new products, new distribution, and supportive clinical data.
She believes Regeneration is undervalued vs. its peers, trading recently at only 19 times her 2005 earnings-per-share estimate, vs. 30 times for its peers.
Sharadin remains enthusiastic about the company's business and stock, yet trims her 44 cents 2005 earnings-per-share estimate to 40 cents on the view that 44 cents is too high, and the fact that the company will be sharing some future product revenues with Stryker Corp. (SYK
), its distribution partner. She views $12 as fair value for the stock.