Shares in Imricor Medical Systems Inc (ASX: IMR) have been on the slide recently, falling from levels above $2 to just $1.56 at the time of writing.
This has created a buying opportunity, according to the analysts at Morgans, who have issued a new research report into the company with a bullish share price target.
Image source: Getty Images
Innovative medical technology gaining traction
Imricor has developed a suite of products such as catheters, sheaths, and other tools which can be used under real-time magnetic resonance (MR) guidance, rather than under x-ray fluoroscopy guidance, thus taking advantage of MR's superior imaging capabilities.
The company has had some wins recently, with the Children's Medical Centre Dallas signing up to buy Imricor's NorthStar mapping and guidance system, becoming the second US hospital customer just two weeks after the launch of the company's US commercial operations.
Imricor said:
Children's Medical Center Dallas will be the second customer under Imricor Cardiovascular, validating the newly launched vertical and the market opportunity across more than 250 children's hospitals and more than 2,000 adult hospitals in the United States.
The company also recently announced that the US Food and Drug Administration had approved a manufacturing module which covers the design, manufacturing, and quality processes around seven Imricor products.
Imricor Chair Steve Wedan said:
Manufacturing is one of the most demanding components of any PMA, and ours covered seven devices at once. To have the FDA complete its evaluation and close this module is a strong validation of the design controls, production processes and quality system our team has built. It is the kind of milestone that is easy to state in a sentence but very hard to earn.
Morgans said in its new research note on the company that its share price had fallen more than 20% since it entered the S&P/ASX 300 Index (ASX: XKO).
The broker added:
The recent share price weakness creates a great buying opportunity. The recent news flow has been positive and we expect further key milestones to be announced over the next three to six months.
Morgans said a collaboration with Philips combining Philips' MRI platform with Imricor's cardiac systems and catheters offered a purpose-built alternative to x-ray guidance.
They added:
It is available immediately in CE-marked (European) markets. The partnership expands IMR's commercial reach and creates a scalable platform for future MRI-guided interventions across additional clinical application. We expect this will accelerate commercial adoption across the Philips global network. The other major manufacturers (Siemens and GE Health) will be following suit.
Morgans has a price target of $2.90 on Imricor shares compared to $1.56 at the time of writing, which would represent upside of 85.9%.
Imricor is valued at $568.3 million.
