XILLIX FDA APPROVED Message Board

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Biotech / Medical : XILLIX FDA APPROVED

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To: Gari Rolfe who wrote (274)	6/26/1998 11:01:00 AM
From: Garry K.	Read Replies (2) of 572

I received some analysts reports on Xillix, dated June 4th... Midland Walwyn -- rate XLX as a 1-Buy with a 1 year target price of $4.00. Believe Xillix should receive royalties of approx. 11% based on Miravant's sales of Photopoint. This is the first time we have seen a medical device company receive royalty based on sales for a drug. We view this alliance as being one more stamp of approval for Xillix's technology and reflection of management to continue to add shareholder value. Leavesque, Beaubien, Geoffrion -- with a current market cap of only $65 million, we think that Xillix's risk-reward profile highlights the stock has a good value play. We anticipate continued commercial and scientific progress this year and expect to see Xillix stock double within a year. Our forecast calls for accelerating revenue growth beginning 1999, followed by a modest profit in 2000 and a sharp earnings breakout in 2001. If we apply the medical device industry average P/E multiple of 26X to projected F/D 2000 EPS of $.35, and discount at a rate of 30% annually, we arrive at a share price of $3.63 today and $4.72 in one year. Even if we discount at a more conservative rate of 40%, we still arrive at a price of $2.80 today and $3.92 one year out. The bottom line is that Xillix remains undervalued at today's prices, especially given its rapid growth potential and low valuation compared to other commercial-stage medical device companies. We are therefore reiterating our STRONG BUY recommendation with a 1 year target price of $4.75. Garry

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