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Biotech / Medical : Boston Scientific (BSX) Any Comments???
BSX 94.71-0.7%Jan 2 9:30 AM EST
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To: LK2 who wrote (755)11/17/2000 10:28:32 AM
From: Lighthouse   of 798
 
Barrons makes some points that I agree with. However, I would add the following:

1) Stent market share continues to erode and I doubt BSX has 21% share anymore. JNJ is now back in the game and MDT, and GDT have nice offerings.

2) Stent pricing is eroding, albeit slowly

3) The acquisition of Medinol will knock $.05 to $.20 off the 2001 EPS numbers, depending on purchase price and assumptions of transfer pricing and margins.

4) Even with internally generated stents, it is my understanding that BSX has to continue buying from Medinol for a period of time. (Several years remaining if I remember correctly)

5) BSX could easily get the dollars for a buyout of Medinol - issuing shares at these prices would be unwise. However, this releverages the balance sheet and crimps flexability again. We are just getting over the effects from the Schnedier acquisition and its related debt binge.

6) BSX competitors trade at at apx. double to the price to sales that BSX does on 2001 revenue estimates. Even St. Jude (4.04 X next years sales) trades at about double BSX's price to sales (2.09). Expectations are low.

7) Insiders are indeed adept at timing their purchases, but since they are the ones who got us in the current pickle one must take that with a grain of salt.

Under $15 washed out? Maybe.

Cheers,
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