Outset Medical price target lowered to $6 from $26 at Stifel

Stifel lowered the firm’s price target on Outset Medical to $6 from $26 and keeps a Buy rating on the shares after Outset pre-announced “well-below consensus” Q3 sales. Management highlighted stronger-than-anticipated FDA warning letter impacts, competitive dynamics and capital spending pressures caused an elongation of Tablo’s typical 9-12 month acute setting sales cycle, which suggests “we’ve entered into an extended period of uncertainty as we await Outset’s FDA warning letter resolution and TabloCart 510K approval,” the analyst tells investors. While it may take two to four quarters for Outset’s fundamental performance to head in a more-positive direction, the firm does not believe “this is the end of the OM story,” the analyst added.