Hi guys, just wanted to show you one of my holdings. It’s a Medical stock, and yes, you should diversify your portfolio to hold some medical stocks. That sector is performing quite well. Anyway, if you like Ragin’s China Medical Technologies, Inc. (ADR) [[CMED]] , then check out my Natus Medical, Inc. [[BABY]] (that sounded weird).
COMPETITION/Sector Watch:
Top 5 Companies in the Medical-Systems/Equip Group above $10
Illumina, Inc. [[ILMN]]
Natus Medical, Inc. [[BABY]]
Bruker Corporation [[BRKR]]
Varian Medical Systems, Inc. [[VAR]] !
China Medical Technologies, Inc. (ADR) [[CMED]] – reports this week, so make sure their guidance is higher too
Here’s the group’s chart. Take a look: 1-year chart for Gio’s Surf with Meds Group
FUNDAMENTALS
BABY reported earnings this past July 31. Good stuff!
– Record revenues. Revenue was up 62% over previous year Q2.
– Raised guidance on revs for the full year ( = good for sector).
– Here’s a link to their latest conference call and income statement.
TECHNICALS
Some points of interest:
– Broke out of a 1 month channel recently.
– Volume spiked to 2.58 million on 7/15 at $21.77.
– Momentum is falling, so I have a buy entry point at $22.90.
– I’m hoping volume will pick up in August, now that they finished reporting.
– Benchmark stock/correlation: Cardinal Health, Inc. [[CAH]] … if Cardinal health sells off, throw your BABY in the dump (sounds evil), if CAH breaks out, add to BABY.
Above the comments:
BABY is in a sector that is creating some nice swells. Medical stocks are typically a safe-haven for investors when the overall markets are doing bad, so I thought I’d give this BABY a try since our market looks damaged. BABY has a nice breakout pattern so average in. The CEO of BABY is very aggressive, and isn’t afraid to spend all their cash on acquisition. He did mention he wants to save up until the 4th Q. You decide if that’s a good thing or not. Right now, momentum is cooling in BABY, so I lowered my entry point, but I expect it to gain it back after CMED reports. Come on BABY!!
There is a very successful micro cap activist fund that a guy I know is with. They have held BABY for a while, and it has been one of their solid performers this year. I snuck a peek at the newsletter, and their conviction is rock solid on it.
Excellent post! I’ve also been looking at VAR lately. The numbers were absolutely explosive and the stock is very, very cheap. Don’t own it yet, but, in time, when the stock starts to build a base, I will begin to nibble. Next to CMED (fingers crossed on Monday’s report), VAR is my favorite name in the space fundamentally.
Phil
Oh, I forgot to mention, nice fuckin’ analysis bro!
I’ll add BABY to the rest of my XLV sector short sells,
AMGN,IBB,OSIP,
BABY at RSI 64 ( I don’t like shorting at RSI 64 )–
I see it at RSI 69 ( more upside )I’m shorting BABY—
VAR looks like a short sell NOW !!!
Dang, I’m finding all these XLV stocks setting up to fail__
CAH reports AUG 7th__ I doubt it will break out to the upside before earnings day, but if it does break-out on earnings, I think it takes out the 200 day 56 easy__
Who’s DSB? — I think He uses very dis-respectful language toward you, GIO—
comment on the VIX
http://beanieville.blogspot.com/2008/08/vmw-is-now-buy.html#comment-1084254
Hey DSB, thanks for the inside info. I’m curious- what does that small-cap-advisor like most about BABY? Volume tells me someone likes it.
Sup Phil from Brazil… I got a friend from Ecuador. They be super crazy soccer players. Anyway, I like VAR too, I put an “!” because I can see myself buying this on a dip between 54-56, and buying again above the 52-high. These top 5 med stocks are all trading near 52-highs while the Dow, S&P and Naz are trading near their YTD lows. CMED has the highest risk/reward factor, while VAR looks more conservative.
Z… I’m hoping CAH’s double bottomish holds. If you get long one of the 5 Med Stocks, then hedging with puts in CAH’s conference call may be one way to go about this trade. Even buying a few puts in IBB as you are long med stocks is a good idea if you are heavily long. But for now, I’m not calling any tops.
Gio,
We’re 100% soccer, baby! …And a little jiu-jitsu. 🙂
As for VAR, 54-56 is probably the way to go. Honestly, in this mkt, I just dont trust any 52wk highs (unless they come out of a very tight basis), even for the sizzling medical device stocks. It seems to be a reversion-to-the-mean sort of environment we’re in (buy dips, sell rips). Just my take.
-Phil
Gio:
– 10% organic growth
– Series of good acquisitions that add value. Sonamed should add a dime to EPS, and Schwarzer should add a nickel.
– Anticipation of more/larger acquisitions
– Will exit 2008 at a $250M revenue run rate, 80M above its current rate
– Share price up 5.5x since Jim Hawkins joined just over 4 years ago, and the size of their secondary offering was larger than their entire market cap at the time that Hawkins joined
I’m sure that there are more/technical reasons that they like the stock that have been mentioned in previous newsletters (that I don’t have access to), since they have held it for a few quarters.
Who is z-stock? I think he is very disrespectful to you and to Fly by link whoring his third tier blog.
You forgot AMED ahd so did I.
I bought in on Friday afternoon after it sold off its earlier gains.
🙂
Happy trading. There are a lot of nice opportunities in the health area. I think Danny also mentioned VRUS on this site. I love that one as well.
GIO, now you see why I never come over to FLY’s___I can’t stand the people here__-
so, It was nice while It lasted, but I won’t be coming here at all___
I’ll just leave my comments at wallstreak or at your old site—
later
Z Stock:
Man up, will ya?
Gee, you’d think your brain was made from jello, considering how soft you are.
Z-stock, you can’t take things personally. Everyone has their balls busted here. If we don’t bust your balls, it means we don’t like you, usually.
You see, almost any monkey can pump stocks, but it takes an extra special monkey to pump stocks, bust balls, and have a laugh, all at the same time.
Just ask the famous 3rd tier blogger Leonard the Monkey. His election video featured him pissing in his own mouth, and not even once did he threaten not to visit the site again.
Z-stock act your age and grow up. Seriously, children should not be allowed on the internet.
And Z-stock, keep in mind that Danny boy is just learning how to drink, legally. We still have to call his mommy and tell her when he gets out of line, but we just keep rewarding positive behavior, and ignoring the negatives, and he is growing up just fine!
Gio, It won’t hurt any that BABY got a mention in Barrons this weekend….
Shed, that’s asinine, I could drink you under the table easy.
Ease up on Z-man fellahs, he’s a good guy. Maybe a bit touchy, but I’ll vouch for him. That’s not his usual style.
He needs to hang around here more often, get used to the vibe, that’s all. He’s got some decent ideas, needs to stop wasting them over at PermaBull Beannie’s.
Danny, lmao. Dude, I’ve got years of practice on you.
However, the iBC gang must meet up and settle this once and for all.
I think, since you are single and rich, that you should come to the East.
I’ve got no problem with Z, Jake. I’m serious. We all bust balls. And I was serious that getting your balls busted means you’re well liked. Kind of like getting a nickname, from your friends. Even if the nickname is gay, its okay. Right, Plutonium Peeny?
My money is on Wood.
Those Southern boys grow up on moonshine. They’ll drink you under the table, then take your watch and wallet, while you’re asleep.
Fly’s right. There’s somethign that happens to one’s gut, when it is seasoned with corn liquor, and Pabst Blue Ribbon.
Stella Artois is to corn liquor and PBR like a work out on the Ab Lounger is going to the Gym.
Z, you’ll be fine. Character is built on accomplishments.
Hey phil-from-brazil… do u know Bruno from Brazil? He was a jujitsu champ. He’s one of my body guards.
Speaking of drinking, I was at DnB this past Thursday, and I asked the waiter guy if it was happy hour… he stared and said to me in a gay manner, “In about 15 minutes, but every hour can be happy hour.” What the! I’m outta here. Nasty.
I guess I lashed out at your suggestion that I can’t hold my own. However, the competition stands.
We shall rendezvous at a predetermined rendezvous point and settle this hours old feud once and for all.
Should it be a beer-off, or a hard-a type event?
I suggest the ‘Century Club’ for warmup.
Were it up to me, I’d go beer.
I think its funny that you thought I was saying you couldn’t hold your own, when I actually I was just poking fun at your age…And then you let the mommy comment go? lol..
If we ever get to meet up, it will be EPIC.
Hi F8… I’ll check out [[AMED]]
Yes, it would be epic. Stella? That might be an unfair advantage. Beer is good.
I just want to reiterate, there’d be no animosity at our drinking contest. Just strippers and revelry.