Hi Bob,
Like you, I have been accumulating shares of nhmcf over the past year (a very significant position).
As I have mentioned previously, this young company is showing impressive gains in revenue growth- a very good sign for a company with new technology.
Here are some reasons I am so bullish on this company:
Most hospitals/health organizations tend to place relatively small orders with a new company initially (each individual department, such as opthalmology, medicine, orthopedics surgery, ob-gyn, etc. usually does its own ordering) as a "trial" to test reliability, price,etc. In addition, the hospitals involved often ordered products from the same company over a certain length of time. Once a young company such as nhmcf shows that it can beat the competition re. price, reliability, quality of products, etc., the hospitals involved would start to place larger orders, while the purchasing managers of the different departments in the same hospital would then "compare notes" and start to place orders with the same company. In addition, once the existing contracts with the competition run out, hospital purchasing managers would then sign new long term contracts with the new company to get better pricing, quality, etc.
For the reasons above, as a young company, nhmcf 's increasing revenue is very encouraging. Increasing revenues suggest to me that nhmcf is getting "its foot in the door" of many hospitals, where its product quality and competitive pricing will speak for themselves.More importantly, I believe that the truly big contracts will be arriving soon as nhmcf proves itself to its new clients (more departments will sign on for long-term contracts as the old ones expire). In today's climate of cost control in health care, quality at a cheaper price, as delivered by nhmcf, will always win out. Remember also that health care is independent of inflation/deflation, Asian/market troubles, etc. In addition, unlike many other technologies (eg. high tech,computers, machineries, etc), hospitals do not need to change their infrastructure/wiring/hardware to make changes from the competition to nhmcf products. Hence, the only determinants will be quality and price of nhmcf products vis a vis its competition. In other words, hospitals do not have to undergo costly changes to adapt themselves to nhmcf products (unlike a change in computer system operations, for example) and they therefore will readily switch over if they find better quality and pricing. With its robotic technology and increased efficiency, nhmcf will eventually win out in many cases. The bottom line with this company is "patience" as we wait for the large contracts to be signed and announced in the (hopefully) near future.
Now for some TA (not my forte, admittedly), it seems the stock price has found strong support around the US$4.00 area, with increasing volumes lately. Any good news should carry it above the all-important $5 level (with any luck). Hopefully, as the shares change hands at the recent $4.00 level, long-term/value investors will take over the day-trader types and the stock price will find firm support at this level prior to going up with good news.
Sorry to be so long-winded....but as you can tell, I am bullish and long re. nhmcf |
