TriPath Imaging: The Prognosis Is Good

By Gene G. Marcial

After The Fall
Another diagnostic outfit that has caught the eye of investors is TriPath Imaging (TPTH ), a maker of screening systems for Pap tests and other cancer-assessment products. Its stock, at 10 in April, slid to 7 in August but has since crept up to 8.30. "TriPath is an undervalued play in cancer diagnostics with its broad range of promising products," says Todd Robbins of T. Robbins Capital Management, which owns shares and invests mainly in medical stocks.

Analysts are upbeat on TriPath's deals with major companies, expecting they will buoy earnings. William Bonello of Wachovia Securities says TriPath has lifted its forecast, expanded ties with No. 1 Quest Diagnostics (X ), and linked up with major medical centers. In late September, TriPath will sign a pact with a major commercial laboratory to market to its physician clients TriPath's SurePath liquid-based Pap test for cervical cancer screening. On Sept. 16, TriPath granted Ventana Medical Systems (VMSI ) world rights to sell a Ventana brand of its product. Bonello sees TriPath in the black in 2004 with earnings of 1 cents a share. In 2005, he sees a hefty 26 cents.

Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them.

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