Varian Medical (NYSE:VAR) Will Gain from Revitalized Hospital Purchasing

Varian Medical (NYSE:VAR) offers a good risk/reward opportunity, according to Jefferies (NYSE:JEF), citing an improving environment in hospital purchasing.

Jefferies said that, "although the Japan comp interrupts VARs consecutive double digit oncology order growth streak, we believe VAR is best positioned to capture the Rad Onc growth opportunity over the next few years. GM expansion will drive upside to out year EPS estimates allowing us to maintain our bullish view."

They raised their full year 2011 EPS estimate from $3.40 to $3.45.

Jefferies maintains a "Buy" rating on Varian, which was trading at $68.75, falling $3.21, or 4.46 percent, as of 2:54 PM EST. Jefferies boosted their price target on Varian from $71 to $84.