Delivering Drugs - And Revenues (DMAX)
Konrad Kuhn (The KonLin Letter) sees an opportunity in drug
distribution. When it comes to setting prices, over 25,000
independent retail drug outlets are practically beholden to
major distributors and drugmakers. Plus, those giants gleefully
underserve the independents in service and technology. To the
rescue is DrugMax.com, an e-commerce business that offers
9,000 independents the buying powers, price efficiencies, and
online ordering technology of a retail chain.
Like many new e-commerce providers, DrugMax.com has yet
to turn a profit. But that may change soon, Kuhn says. For
example, revenues for the first nine months of FY 2001 grew
484% to a record $122.6 million. The firm achieved positive
cash flow for four straight quarters, net revenues surpassed
projections, and a net loss fell 10% to ($0.09) per share
from last year's ($0.10). Meanwhile, the company has $3.6
million in cash and equivalents, and Kuhn predicts profitability
by the end of 2001.
"We would use all weakness, especially dips in to the $5-1/2
area, to purchase up to the $8 level," Kuhn says. "Our target
is $12."
For more on Konrad Kuhn's advice see "Technology Ideas," June
27, 2001, The Technology Digest. Nancy Zambell excerpts from
investment publications and highlights compelling high-tech
opportunities uncovered by the top minds on Wall Street. |
