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 : Biotech Valuation -- Ignore unavailable to you. Want to Upgrade?

To: Biomaven who wrote (7805)	1/26/2003 2:30:41 PM
From: Vector1	Respond to of 52153

Peter, did you see where IPH closed on Friday. I have been a lonely CRXA bull for a long time but on a pure earnings basis IDPH looks cheap. Prob around 25 times next years EPS. For a biotech growing earnings at 30% it looks very cheap. V1

To: Biomaven who wrote (7805)	1/28/2003 7:12:21 AM
From: Crossy	Read Replies (1) \| Respond to of 52153

re: AMEX: IMA @ $16 (Inverness Medical Innnovation) Biomaven, this is not a typical "REAL-OPTION" like biotech startup but a major firm, a midcap and IMHO an upcoming heavyweight in Diagnostics. CEO Zwanziger is a renowned WallStreet Darling.. Homepage : invernessmedical.com biz.yahoo.com Industry: Biotech & Biomaterials, mostly Diagnostic kits and nutritional supplements Business summary: Inverness Medical Innovations, Inc. develops, manufactures and markets consumer healthcare products, including self-test diagnostic products for the women's health market and vitamins and nutritional supplements. To a lesser extent, the Company develops, manufactures and markets clinical diagnostic products for use by medical professionals. Its existing self-test products are targeted at the women's health market and include home pregnancy detection tests and ovulation prediction tests. Inverness also sells a wide variety of vitamins and nutritional supplements. Its clinical diagnostic products include test kits used by smaller laboratories, physicians' offices and other point-of-care sites for the detection of pregnancy and a wide variety of infectious diseases. This is a very interesting company IMHO and I will include it in my "absurde value" portfolio. The company has been growing 5fold by acquisitions and from endogenous forces from $50m to $260m in annual revenue over the last 2 years. Valuations are still compelling: Price/Sales at 0.80 and Price/Book at 1.50. Gross margins are around 50% and further growth is almost assured. Only 14m shares out and the firm seems to be aiming at preventing dilution whenever possible. The company had acquired UniPath from Unilever, Wampole, IVC and other companies in 2002. Right now a move to acquire specialty Osteoporosis firm OSTX is in the works. SEC-Edgar info can be found here: sec.gov. Another factor is management. The company's CEO, Ron Zwanziger has already hit a "home run" twice. He founded MediSys and sold it to Abbot Labs for $800m. He then founded Inverness and sold its comprehensive diabetes line (an entire division) and sold it to JNJ for $1.2bn. Now he seems poised to do this again in pregnancy and other specialty diagnostic arenas like infectuous diseases. More than 24% of the common stock of Inverness is held by Mr. Zwanziger's family. But ivy-league investment bankers already joined shareholders' ranks: Deutsche Bank owns more than 5% as does SSB (Salomon Smith Barney), Morgan Stanley and Lehman Brothers own smaller percentages: biz.yahoo.com A December issue on "Inside WallStreet" of Business Week featured this company. One fund manager believes Inverness could grow to $1bn in revenues by 2004. The high Sales per share figure of this company ($18 sales per share), a hard to find revenue CAGR (compounded annual growth rate) in excess of 200% (revenues) coupled with nearly 50% gross margins are IMHO indicative of the earnings potential this firm has, a rare credential these days. An investor presentation, available on SEC Edgar gives an overview of Inverness strengths of adressed markets (18% of pregnancy test kits) and its strategy: sec.gov. Readers should note that Inverness was formerly called "Selfcare" in its early days. CEO Zwanziger's "theme" might be regarded as a "whole product" concept, introducing convenience and assurance, propped up by vertical related service and by-product offerings (complements) in formerly highly guarded "science" dominated fields, with notions of self-centered instead of customer-centered orientation. This is definitely a low risk, yet very compelling investment for the midterm (around 2 years). Since IMA (Inverness) combines the good valuation of an asset play (when you use DCF) with a sector consolidation and tremendous growth opportunity, I expect it to outperform not only the market but also its direct competitors by a wide margin. A takeout speculation for many times then comes on top of this.. Given the extraordinary opportunity, it's about time someone created a subject for this gem of a company..