Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Biotech / Medical : The Stock for 1999(Polymedica)PLMD(Medical Supply Co.) -- Ignore unavailable to you. Want to Upgrade?

To: Sam who wrote (3230)	3/26/2001 12:40:37 PM
From: Paul Kern	Respond to of 3414

PolyMedica Corporation (PLMD-NASDAQ) Target Price Change Shares Fall 50% On Announcement Of FBI Investigation 2 Years Ago Shares Appear Statistically Cheap--Reiterate Strong Buy Rating Rating: 1 Price: $17.00 52-Wk. Rng.: $62-17 Shares Out.: (MM) 13.3 Market Cap.: (MM) 226.1 Key Points Shares of PLMD fell approximately 50% on Friday due to a report of four customer complaints in June 1999 that were referred to the Federal Bureau of Investigation (FBI) for investigation. While any company dealing with Medicare is subject to constant scrutiny, it appears that PLMD is not currently subject to an investigation. We believe PLMD and its Liberty Medical Supply subsidiary have the intent to comply with Part B federal regulations related to its business. We feel that Friday's activity was an overreaction to the announcement. Currently, shares of PLMD appear statistically cheap, trading at 6.7x our calendar 2001 EPS earnings of $2.54. We have maintained our fiscal Q4 2001, fiscal 2001, and fiscal 2002 EPS estimates of $0.59, $2.16, and $2.65, respectively. Also, at current prices, PLMD shares are trading at 4.65x estimated March 2001 EBITDA of $50 million. Using an enterprise value-to-EBITDA valuation of 8x fiscal 2002 EBITDA (excluding amortization of advertising expenses), we have adjusted our 12-month target price to $36 from $72. We reiterate our Strong Buy (1) rating on the shares. investor.cnet.com