I like the idea of how the procedure is done, but after reading the latest 10-K405 and last years, I'll have to pass on this one. The company has too many questionable variables with some favorable aspects. One, it currently cheaper, although the price will come down by other companies for LVC - FTC will make sure of that. However, will SNRS be able to lower their price anymore and still make money? Secondly, it doesn't hurt as much as with ablation machines). However, some of the questionable variables that really concern me are:
1. No real revenue (98% of revenues were being generated by their dental operation which has subsequently been sold).
2. High level of debt with significant losses in the past and going forward for all of 1998 and beyond with an accumulated deficit of $37,000,000.00. You can't remain a going concern without making profit eventually. How many private-placements can a company have?
3. Long-term effects with regression remain unknown (although short-term effects are positive). Cheesieboy, who I really don't care for indicated the body has a way of healing itself-which unfortunately, I do agree with-which clouds my thoughts about the long term effects of the procedure.
4.. Substantial stock-28.5 million shares with more to be offered in the future (dilutive effect on stockholders).
5. To date, international sales of the LTK system have been limited.
Revenue in the United States cannot reasonably be expected before the second half of 1999, at the earliest (that's just revenue-no mention of any profit or time table set to become profitable).
6. No expectant FDA approval until 1999.
7. Possible competition by larger more established companies.
In all, I understand 10K's have to list all the possible negatives and positives, but with this one, there are just too many negatives outweighing the positives. However, I do believe it would make for a favorable acquisition candidate. It's been nice and I'll keep watching the company, but cannot buy at this time..Good luck to all...Pappy |
