Analyst: economic woes may hurt Mentor profits

Although analyst Amit Hazan maintained his "Outperform" rating and $35 price target on the stock, he added that "it's hard to see anything short of an economic rebound driving Mentor higher" over the long term.

Year to date, Mentor shares have lost nearly a quarter of their value.

According to Hazan, a continued weak U.S. breast implant market in the company's 2008 fiscal first quarter ending June 30 likely means that Mentor won't meet its fiscal 2009 sales projections.

Also hampering Mentor is the price of the company's recently launched wrinkle filler, Prevelle Silk. Although Prevelle Silk is priced at $100 per syringe, $40 less than competing products, Mentor's filler is being discounted even further.

A spokesperson for Mentor wasn't immediately available for comment.

While conceding the poor economy could impact Mentor in the short term, Jefferies and Co. analyst Peter J. Bye said in a note Thursday that the company's stock price already accounts for these difficulties. He added that most of the company's products face little competition and it has a strong late-stage pipeline.

Bye notes the company's late-stage anti-wrinkle injection PurTox is on track for a Food and Drug administration filing in the summer of 2009. If approved, PurTox would compete with Allergan Inc.'s Botox.

Bye holds a "Buy" rating and $36 price target on the stock.

Shares of Mentor fell 76 cents, or 2.5 percent, to $29.86. Allergan shares fell 75 cents to $54.95 in midday trading.