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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: Ploni who wrote (18008)	4/9/1999 1:12:00 PM
From: Marconi	Read Replies (1) \| Respond to of 18691

Hello Mr. Stein: VISX Wow! Hard to believe that price. Quite linear for a whole year. P/S at 30 or so is at the high end for a 'medical' company. I did not dig into their business. What VISX's contribution is. If they are in the OEM business and make proprietary excimers that are protected (hard to believe) as well as have proprietary and medically exclusive software, they may have something. But not this much. I have always had reservations about invasive treatments to the eye--triming the lenses to avoid glasses. IMO it remains an experimental procedure and it may be decades before the sequelae are understood. Tendency toward cataracts or other long term vision problems remain and open question. Lack of major discomfort or immediate acute effects do not mean the procedure is safe decades out. That is in test now with people. If the business is modifying an excimer laser and selling the reconfigured setup to aggressive ophthomologists for excimer reshaping, then I would look for signs of growth pancaking. If one could guess the extent of substitution of this procedure versus eyeglasses, one could peg the rate of market penetration quite accurately with the market information in hand already. As little as 1% market penetration can define the whole substitution curve within 10% or better forward, IF the extent of substitution is surmised properly. My guess would be that because of the capital expense involved, less than 20% of all ophthomologists would buy the system. And others may enter that arena with me too FDA applications (the FDA ours is equivalent, Doctor ours is better because it has a louder ka-ching! folks). If you are watching VISX, please keep us informed when you think would be a superior entry point to short. The core technology would lend itself very handily to a technology substitution analysis. Unfortunately I do not have the time to perform that, but this one looks ideal for that analysis. Best regards, m