On Apr 2, we issued an updated research report on AngioDynamics Inc. (ANGO Quick QuoteANGO - Free Report) . The stock has a Zacks Rank #3 (Hold). While a strong portfolio is likely to enhance customer base, high debt levels continue to bother the company.

 

AngioDynamics’ broad product spectrum lends it a competitive edge in the U.S. MedTech space. In this regard, the company’s flagship NanoKnife platform has been driving growth for its Oncology business. In the just-reported third quarter of fiscal 2018, the platform was a major contributor to revenues as it witnessed mid-teen growth in sales on a year-over-year basis.  Earlier, the product had received FDA clearance for the surgical ablation of soft tissue.

 

AngioDynamics has also provided an innovative series of minimally-invasive medical devices used for vascular access, surgery, peripheral vascular disease and oncology. The portfolio includes ablation systems, fluid management systems, vascular access products, angiographic products and accessories, angioplasty products, drainage products, thrombolytic products and venous products.

 

Apart from portfolio strength, the company’s balance sheet continues to show solid cash-flow generation. At the end of the third quarter, AngioDynamics had generated $4.3 million in operating cash flow and $3.9 million in free cash flow.

 

On the flip side, the company’s third-quarter sales fell by almost 2% on a year-over-year basis. The downside was led by declines in Venous unit, RFA product (radio frequency ablation) and PICCs businesses.

 

Furthermore, high debt levels continue to plague AngioDynamics. The company ended the third quarter of fiscal 2018 with debt of $93.8 million. The debt level in the second quarter was $95 million. This is likely to impose certain operating and financial restrictions.

 

 

In the past year, AngioDynamics’ shares have gained a nominal 2.1%, compared with the industry’s gain of 24.4%. The company is exposed to pricing headwinds stemming from lower selling prices of peripheral vascular products due to aggressive price competition.

 

 

 

A few better-ranked stocks in the broader medical sector are athenahealth, Inc. , Bio-Rad Laboratories, Inc. (BIO Quick QuoteBIO - Free Report) and Centene Corporation (CNC Quick QuoteCNC - Free Report) . Each of these stocks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

 

athenahealth has an expected long-term growth rate of 17.7% and projected earnings per share growth rate of 21.5%.

 

Bio-Rad has an expected long-term growth rate of 20% and projected earnings per share growth rate of 20%.

 

Centene has an expected long-term growth rate of 14.4% and projected earnings per share growth rate of 14.4%.

 

 

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