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Varian Medical Systems Inc.

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Varian Medical Systems reported impressive first quarter fiscal 2016 results. However, strong U.S. dollar and intensifying competition in the Oncology market continued to hurt results. Nevertheless, we believe Varian is well positioned to benefit from higher demand for its products in China and BRICA countries. Product-wise, aggressive investment in the software business is a key growth catalyst. We believe that the newly approved VitalBeam product presents significant growth opportunity for Varian over the long haul. Moreover, the company’s focus on improving cost structure by reducing headcount and streamlining operations will boost profits despite the significant impact from foreign exchange headwinds.

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