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What Analysts Recommend for TransEnterix and Peers in August 2018

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Senhance performance trajectory

In Q2 2018, TransEnterix (TRXC) sold four Senhance surgical robots. One of these was sold in the US and the other three in EMEA markets. Senhance requires a sales cycle of four to six quarters. The majority of Senhance systems have sold at an average selling price (or ASP) ranging from $1.2 million to $1.8 million. While the price is near the lower end of the range in the US, it is at the higher end of the range in Europe.

Senhance is approved in the US for multiple digital laparoscopic procedures such as an inguinal hernia, colorectal surgery, cholecystectomy surgery, and gynecologic surgery. TransEnterix aims to expand the penetration of surgical robotics globally, which currently stands under 10%.

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Senhance was sold to LSU Health in Q2 2018. This system has been installed at the University Medical Center New Orleans (or UMC New Orleans), which has partnerships with many local medical colleges such as Tulane School of Medicine and LSU Health. UMC New Orleans has also trained its surgeons to use Senhance to perform digital laparoscopic colorectal, gynecological, and other surgical procedures.

Florida Hospital has also been expanding the use of the Senhance system to perform not only colorectal surgeries but also cholecystectomies and inguinal hernia repair surgeries.

Analyst recommendations for TransEnterix

Of the five analysts covering TransEnterix in August 2018, one has recommended the company as a “strong buy,” one has recommended it as a “buy,” and three have recommended the company as a “hold.” Wall Street analysts have a 12-month consensus target price for TransEnterix of around $5.21, which would be an increase of approximately 2.2% over the company’s closing price on August 23.

Analyst recommendations for peers

Of the 29 analysts covering Stryker (SYK) in August 2018, around 65.5% have recommended the company as a “buy.” About 52.4% of the 21 analysts covering Johnson & Johnson (JNJ) recommend a “buy,” and 64.7% of the 17 analysts tracking Intuitive Surgical (ISRG) recommend a “buy.”

In the next article, we will discuss revenue growth prospects for TransEnterix in greater detail.

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