VISX Message Board - Msg: 2458610

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Biotech / Medical : VISX

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To: Charlie Smith who wrote (328)	10/15/1997 10:58:00 PM
From: John Binford, Jr.	of 1754

Looks like a very good quarter for Visx. Positives: Many Good earnings -- $.22/sh fully taxed (assuming future 40% tax rate which is still over a year away) Increase cash by around $10 million!!! (Way to go. Everyone loves a company that can build cash and not burn it !!! (Muller never figured that out)) Nice drop in accounts receivable a big contributor as well as excellent earnings. FDA cracking down on illegal lasers!!! 6 Black box conversions! These guys will buy alot of key cards as they are already established. Watch for more to come as the trade-in policy won't last forever. Expedited PMA (without requiring a panel meeting) for higher myopia with astigmatism. (Although I think FDA has a different definition for this word expedited -- something like a PMA in which they don't lose the paperwork before they get to it. Or a PMA in which they don't accidentally send it off to a competitor before they process it. Ok maybe I'm being too hard on the FDA as they seem to be coming around.) Marketing expenses were up $1.4 million over last year's 3rd quarter, but roughly in-line with the 1997's 2nd quarter. Seems like a reasonable amount and indicates Visx is generating more money as earnings versus the 3rd quarter in 1996 were only off $334,000 and yet the company spent much more than that this past quarter in marketing. We know that LVCI has had their two best months ever in August and September and so maybe payback for these marketing expenses will be seen many times over in the coming quarters. Also, I can't help but comment on what a fantastic balance sheet. Mark Logan and company have done an excellent job keeping expenses in check and turning out a good profit. People may complain about the conservative approach, but Visx is the company delivering earnings when others in the business have yet to deliver. It appears Visx is at the knee of the curve (earnings curve) and next quarter should start to see the fast growing Royalties/service/other rev line start to more than offset any reduction in earnings due to reduced prices on machine sales which were only off 2 units over last years full production quarter. Negatives: None really. Ok, maybe a negative is that long term common stockholders don't get to hear the conference call live and then get a cut version for the replay. ----------------------------------------------------------------------------------------------------------- It's no wonder the stock has pushed back up from it's lows in the 18's. I just wish the company had bought more of the stock back at that level so we could get more leverage on our holdings. I decided to bite off a little more at 18 1/4 when the stock looked weak and hopefully soon again we will think $25 looks pretty cheap (remember those days)

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