Though he expects good things from Xtent's (XTNT) drug eluting stent in the future, currently Zacks senior medical devices analyst Greg Aurand, CFA is taking a wait amp; see stance on the shares. He explains why in his latest report:

Xtent's proprietary Custom NX drug eluting stent system has the potential to correct or mitigate some of the current concerns surrounding the drug eluting stent (DES) market. Since we do not expect any commercial revenues until the second half of 2008 (2010 in the U.S.), we believe the stock will be driven in the near term by several clinical and regulatory events that confirm the clinical and commercial potential of the Custom NX system.

However, the company is reliant on Biosensors for regulatory approval of the stent coating and any regulatory delays will affect our outlook. We initiate coverage on the stock with a Hold rating, as well as a price target of $12 per share.

Given the timeline risks in the story, we believe the stock is fairly valued at 40x our 2011 EPS [earnings per share] estimate of $1.32, discounted 45%, or approximately $12.00. Our target also approximates 4x our 2011 revenues of $305 million, discounted 45%, a premium to the 2007 3.7x revenues of comparables and the 3.9x revenues industry mean.