Interpore Cross downgraded to "hold"

10/16/03 - WR Hambrecht & Co

NEW YORK, October 16 (New Ratings) - Analysts at WR Hambrecht downgrade Interpore Cross (BONZ) from "buy" to "hold," while reducing their estimates for the company.

Shares of Interpore Cross, a manufacturer of synthetic bone graft material for the orthopaedic, oral and maxillofacial markets, are currently trading at $14.68.

According to WR Hambrecht's research note published this morning, Interpore Cross declared its Q303 results yesterday, which were more or less in line with the estimates. Although the 18% increase in the US sales was encouraging, the analysts express their disappointment with the company’s international sales and the sales from the orthobiologics and AOM divisions.

The analysts mention that 2004 may be a tough year for Interpore Cross, with an increase in legal, R&D and marketing expenses. Royalty incomes may also be negatively affected in 2004, due to Johnson and Johnson's new spinal implant, which does not infringe Interpore Cross's patents.

The EPS estimates for 2003 and 2004 have been reduced from $0.34 to $0.31 and from $0.46 to $0.39, respectively. The P/E estimates for 2003 and 2004 are 47.0x and 38.1x, respectively.

WR Hambrecht downgrades Interpore Cross from "buy" to "hold."