ATS Medical shares rise on 2Q forecast

Shares of ATS Medical Inc. rose 5 percent Monday, after the heart valve maker forecast second-quarter profit above Wall Street expectations.

Earlier Monday, Minneapolis-based ATS said it has seen strong sales of both its ATS CryoMaze surgical ablation device, which is used in operations where small portions of heart tissue are destroyed to stop abnormal heart rhythms, and heart valve products.

The company predicts revenue of $16.7 million to $16.9 million for the quarter ended June 28, compared with analysts' average estimate of $15.7 million, according to a Thomson Financial poll.

Shares rose 12 cents, or 5.7 percent, to $2.22 in morning trading.

ATS Medical also said that its recent financing moves, which include a new two-year, $5 million revolving credit line with director Theodore C. Skokos, will be sufficient to execute current growth plans.

Rodman & Renshaw analyst Vivian Cervantes reiterated a "Market Outperform" rating and $3 price target on the stock, noting that the new financing gives ATS increased flexibility as the company moves forward with six new product launches and streamlines operations.

She also noted that the funding agreements show confidence and support from long-term investors.