Cerus shares rise on R.W. Baird upgrade
Shares of Cerus Corp. rose Tuesday as an R.W. Baird analyst upgraded his rating on the company, citing the value and potential of the Intercept blood system.
The system is used to clean bacteria, viruses, and parasites out of donated blood prior to transfusion. R.W. Baird analyst Christopher J. Raymond upgraded the stock to "Outperform" from "Neutral" and raised his price target to $5 from $3.
Shares of the Concord, Calif., company jumped 31 cents, or 13.2 percent, to $2.67 in afternoon trading. The stock has traded between 60 cents and $3.57 over the last 52 weeks.
"With signs of sustainable commercial progress in Europe, coupled with a seemingly overlooked, yet substantial, opportunity for Intercept in red blood cells, we now see a favorable risk-reward here," Raymond said, in a note to investors.
He said commercial traction is rising, citing fourth-quarter revenue gains of 51 percent to $5.5 million. It marks the third consecutive quarter of revenue growth and he expects that trend to continue.
Meanwhile, even modest geographic gains are meaningful, he added. He said ongoing conversions in Belgium, France, Switzerland and Southern Europe alone can yield 2010 revenue of more than $27 million, or a 60 percent boost.
"The major drivers of growth last year were Belgium, France and Southern Europe, and we look to continued growth in these geographies, along with Switzerland, to drive 2010 revenue," he said.
Germany and the U.K., which are not yet online with the system, are viewed as potential for longer-term boosts, he said.
Copyright 2010  AP News
