AngioDynamics: Growth Is In Its Veins

A Dynamic Rebound
For a little-known medical-device maker, AngioDynamics (ANGO ) is a dynamo. A leader in equipment for minimally invasive diagnosis and treatment of vascular diseases, it is expanding into the interventional oncology market, specifically the use of image-guided thermal probes to destroy tumors ("ablation"), which could possibly double sales by next year. "In that sense, AngioDynamics is a pretty aggressive growth story," says Jeff Jonas of GAMCO Medical Opportunity Fund, which owns 362,000 shares. Based on such momentum, he thinks the stock is undervalued. In November, AngioDynamics acquired RITA Medical (RITA ), No. 1 in the $2 billion tumor ablation market and No. 2 in implanted medical devices for drug therapies. RITA's products will add some $52 million in sales to AngioDynamics' $101 million in its fiscal year ending May 30, 2007. In 2008, CEO Eamonn Hobbs expects sales to rise sharply because of the acquisition of RITA and Oncobionics, which owns a novel technology for tumor ablation. Phil Nalbone of RBC Capital, which has done banking for AngioDynamics, forecasts earnings of 75 cents a share in fiscal 2007 and 93 cents in 2008, vs. 53 cents in 2006. He rates the stock, now at 21.97, "outperform," with a 12-month target of 30.

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.

By Gene G. Marcial

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