Tag - MMSI

Ian Wyatt is the chief investing strategist of SmallCapInvestor.com and the chief executive officer of Bushiness Financial Publishing, a publisher of both free and paid subscription newsletters, e-letters, special reports and financial websites. Prior to Business Financial Publishing, Wyatt launched BizFN.com, a free investment website where individual investors could access research and analysis from money managers and financial advisors around the country. In 2007, Wyatt was selected as one of 60 entrepreneurs to participate in the Entrepreneurial Masters Program (formerly Birthing of Giants) at the Massachusetts Institute of Technology Sloan School of business, a three-year executive development education program.

What qualities do you look for in a small-cap stock? Have your criterion changed given the current macro environment?

“Increasing cash flow remains the single best measure to separate the haves from the have-nots. If a firm’s cash flows aren’t increasing, be wary. We look for strong top and bottom-line growth of 25% or greater on a quarterly and annual basis, a build up of cash on the balance sheet, a trend of successive upside earnings surprises and upwardly revised estimates. The company should operate in a favorable industry and markets that contain extraordinary growth potential.

“In the current environment we wouldn’t expect to find as many companies with 25% revenue and earnings growth, so in that sense, yes my expectations have been lowered. We pay closer attention to guidance in this environment, as the probability for downgraded outlooks is more likely.”

What are your favorite small-cap stocks with market caps of under $1 billion for the year and why?

“T-3 Energy Services (Nasdaq:TTES), Life Sciences Research (NYSE:LSR), Cano Petroleum (AMEX:CFW) and Merit Medical Systems (Nasdaq:MMSI) because of the specific niches they operate in.

“T-3 Energy manufactures and repairs equipment used in the drilling and completion of new and existing oil and gas wells, and for the production and transportation of oil and gas. The company has three product lines: pressure and flow control, wellhead and pipeline. Since April 2003, T-3 Energy has introduced 43 new products. As of March 9, the company had 18 manufacturing facilities located throughout North America.

“Equipment failure in the energy industry is not an option and as such T-3 Energy’s customers — namely many of the big exploration and pipeline companies . . .

Bluegreen Corp (Nasdaq:BXG), Momenta Pharmaceuticals Inc (Nasdaq:MNTA) and Hawaiian Holdings Inc (Nasdaq:HA) are among the new 52-week highs in Tuesday's trading among companies with market capitalizations under $1 billion.

Also included among the results: Westwood Holdings Group Inc (Nasdaq:WHG), First Financial Corp (Indiana) (Nasdaq:THFF), Idenix Pharmaceuticals Inc (Nasdaq:IDIX), Cyberonics Inc (Nasdaq:CYBX), LTC Properties Inc (Nasdaq:LTC) and Merit Medical Systems Inc (Nasdaq:MMSI).

Here are the new 52-week highs among small caps:

American Ecology Corp (Nasdaq:ECOL), Allos Therapeutics Inc (Nasdaq:ALTH) and Merit Medical Systems Inc (Nasdaq:MMSI) are among the new 52-week highs in Tuesday's trading among companies with market capitalizations under $1 billion.

Here are the new 52-week highs among small caps:

Merit Medical Systems Inc. (Nasdaq:MMSI) is up 6% today after analysts at C.L. King upgraded the company to “accumulate” from “neutral.” The firm set a price target of $21 for the South Jordan, Utah-based medical device manufacturer. In today’s trading, shares are at $18.98 at 2:10 p.m. ET, up $1.15 from Monday’s close; trading volume is more than triple the average number of shares. The stock soared to a 52-week high of $19.48 early in the trading day. Merit Medical System shares are up more than 36% since January.

Graham Corp (Nasdaq:GHM), Merit Medical Systems Inc (Nasdaq:MMSI) and PC-Tel Inc (Nasdaq:PCTI) are among the new 52-week highs in Monday's trading among companies with market capitalizations under $1 billion.

Here are the new 52-week highs among small caps:

For many aging boomers combating heart disease, it is in Merit Medical Systems (Nasdaq: MMSI), a maker of disposable medical products used in radiology and cardiology, that they will find an indispensable ally.

The company is a market leader in many of the products it offers, which include disposable catheters, syringes, inflation devices, disposable blood transducers, angioplasty needles and guidewires, pressure infusion bags, kits and procedure trays, among many other products. The company peddles 72% of its products to U.S. hospitals, custom packagers and distributors, and original equipment manufactures, with the remainder sold in international markets.

The company received notification from the U.S. Food and Drug Administration in December 2007 of 510(k) clearance for its new Sea Dragon torque device, which is used specifically with hydrophilic guide wires. The Sea Dragon follows November's release of the All-Star hemostasis valve, which is designed to maintain a fluid-tight seal around interventional devices, and the  Prelude marker tip introducer sheath, which allows visualization of the sheath tip for precise placement during interventional and diagnostic procedures. 

According to Fred Lampropoulus, chairman, president and CEO of Merit, all three products are high margin and enhance the company’s revenue growth and profitability in 2008.

Merit’s sale have been growing at a compound average annual rate of 11.8% over the past 10 years to an estimated $207.4 million in 2007. EPS, meanwhile, has been repeating and growing as well — at a 16.2% compound annual rate to an estimated $0.54. The stock closed at 16.07 on Friday. Shares have ranged between $10.89 and $16.84 over the last 52 weeks.

Comptition in the space is formidable, to be sure. Merit butts head with the likes of Boston Scientific Corporation (NYSE: BSX), Johnson & Johnson (NYSE: JNJ) and Medtronic, Inc. (NYSE: MDT), but that's OK. The company has been holding its own against these behemoths for the past 20 years and believes it will continue to hold its own because of “quality of materials and workmanship, innovative design, ease of operation and a prompt attention to customer inquiries.”