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Scanning through the list of "top % gainers on the NASDAQ", I came across Syneron Medical Ltd. (ELOS). I do not own any shares nor do I have any options on this company. ELOS is having a nice day today trading at $15.20, up $1.01 or 7.12% on the day. According to the Yahoo "Profile", Syneron "...designs, develops and markets aesthetic medical products based on electro-optical synergy (ELOS) technology that uses the synergy between electrical energy and optical energy to provide effective, safe and affordable aesthetic medical treatments."
On August 18, 2004, ELOS reported 2nd quarter 2004 results. Revenues for the second quarter were $13.7 million, a 70% increase over the $8.1 million recorded the year earlier. Net income for the second quarter was $6.4 million, or $.30/pro forma diluted share compared to $2.8 million in net income the prior year. In addition, the company estimated that full year 2004 revenues should come in at around $55 million.
Taking a look at the "5-Yr Restated" financials at Morningstar.com, we can see that this company has no revenue in 2000, only $500,000 in revenue in 2001, and jumped to $35 million in revenue by 2003 with $55 million, as noted in the prior paragraph, estimated for 2004.
Morningstar.com does not show any earnings, but from the prior report, we can see that this company is profitable and growing. Free cash flow has been improving from $(1) million in 2001, $2 million in 2002, $14 million in 2003 and $15 million in the TTM.
The balance sheet as presented on Morningstar.com appears solid. There are $21 million in cash and $8.1 million in other current assets, plenty to cover both the $9.1 million in current liabilities and the $3.1 million in long-term liabilities more than two times over.
How about "valuation" questions? Looking at "Key Statistics" from Yahoo, we can see that this is a small cap stock with a market cap of only $335.93 million. The trailing p/e is quite reasonable at 13.00. No PEG is reported. Yahoo reports 21.94 million shares outstanding with 5.50 million of them that float. Only 61,000 shares are out short as of 8/9/04, representing 1.11% of the float or only .13 trading days.
Yahoo reports no cash dividend and no stock dividend on record.
What about "technicals"? Looking at a Point & Figure chart from Stockcharts.com:
we can see that this stock appears to have been trading at about $12 in August, 2004, dropped to a support level of $9.00 later that month, and has just now been trading higher. Not much of a track record, but what is there looks good.
So what do I think? Well, this is a SMALL company and trades just over $10 making it a bit volatile...so be careful if you are 'weak at heart'. However, the recent earnings report is excellent, the earnings are growing solidly along with the revenue, free cash is improving and looks nice, the balance sheet is good, valuation is nice with a p/e in the low teens. However, no analysts are reporting making a PEG virtually impossible to estimate. And technically, although not a long period of time, the chart looks fine to me.
Unfortunately, I don't have any money to invest as I am waiting upon a sale of a portion of one of my existing holdings to justify adding a new position. If you have any questions or comments, please feel free to email me at firstname.lastname@example.org .