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R59- IART
Does it make any sense to you, that the company was posting around $3 in eps in 2021, when the stock was $75, and now is guiding for $3.06 in eps for 2024, yet the stock price is $25 ? I understand that back then, the Boston Factory had no issues, and that margins from the 2 products made there were higher than normal. However, I have a hard time believing that regardless of IARTs other products and latest acquisition pretty much making up for the earnings lost from the Boston Factory closure, that the company is still worth 1/3 the value. I mean, what's the reasoning ? That we now can't trust guidance from the company, as they haven't done a very good job in getting the Boston Factory back on line. You know Re, you once told me years ago, that analysts will often gang up on a company with additional downgrades, even after the stock has gotten decimated, and that often marks a bottom for the stock.
SS- IART- Analyst downgrades
Why are the analysts knocking the price targets down by 40% ? I mean the stock has been pulverized already, and now down to a 8 PE going forward ? I have a hard time believing the problems with the Boston Factory has caused this stock to go down 70% the last two years, and there seems to be no bottom, no matter what guidance the company gives !
Updated portfolio
GERN 39000 shares
IART 10000 shares
Cash $1449
Buy GERN @ $3.84
Buy 39000 GERN @ $3.84 = $149760
Hweb- IDR
I was a bit preoccupied this morning and missed this one. Just curious- what PE going forward do you think it warrants. I just looked at Barrick Gold(GOLD), and huge competitor, and they are expecting 35% growth going forward, and selling for a 12 PE going forward fully taxed. IDR just made $.17 for the March qtr. Based on what I read from the CEO letter, it seems he expects growth to be huge. I wonder if there's any way to try and gauge what they might post in eps over the next few quarters.
IART- How low a PE before it's a buy ?
I guess if you don't believe the company, and think they lie, you should stay away. However if you believe them, then the company says they will post $3.06a avg in eps for 2024, with mid to upper single digit growth going forward. So now the question first is, what is an average PE in the medical device sector ? Answer about 25, and with upper single digit growth expected. So now, with all the negativity with IART, what would you pay ? Right now at $23, the PE is 7.5 going forward. At $20 it would be a 6.5 PE going forward.
Many here think there's something wrong, other than the closure of the Boston Factory for the last year- but what ? Could it be, fear of getting sued by someone who got hurt from the products recalled from the Boston Factory ? You would think if that was the case, we would have heard of something, being that the recall has been going on for about 1.5 years. Now what else could it be ? Could it be that the company has lost market share, and it's products are in decline. Well the company just made a recent acquisition, which they say is going great, and that all of their products are doing nicely, and expected to stay that way into 2025. So what could it be ? They even went on to say in the CC, that even the 2 products that were made in the Boston Factory still have high demand, and at some point they will start manufacturing them again. I mean their balance sheet is healthy, so what ?
I still think holding into earnings is a losing proposition IF
you're a short term trader. Today I got wacked on IART, not only for holding into earnings, but by chasing bad news, thinking the valuation would matter. The longer I play the market, the more I can see why playing good news always gives more % gain potential than playing bad news, no matter what the valuation.
This market is done IMO
Selected reports might be worth a shot, but the market will correct big time by May 31 IMO.
GERN- I sold today @ $3.80
I will likely not to hold into the June 16 announcement. I made a lot back on the stock from $1.70.
SS- IART, thanks for the reply
I too feel that if they can post $3 this year without Boston, and maybe $3.30 in 2025, that the stock is very cheap here. SS, while I understand that investors were disappointed today, why would they be selling the stock down to a 7 PE going forward ? I really think this selling has been waaaay overdone. I mean it sounds to me as though the company has almost completely made up in additional revenues and earnings, what they have lost from not having revenues from the Boston Factory
Updated portfolio
IART 10000 shares
Cash $151,209
Buy IART @ $23.15
Buy 2000 shares IART @ $23.15 = $46,300
R59- IART
The company only lowered 2024 eps guidance by 4%. Why would that cause the stock to go from $35 a few weeks ago to $23 today ? They also said the products they have are doing well, and expected to grow at a mid single digit pace this year. Should we assume they're lying ?
SS- IART
What's your take after todays report ? Do you think this drop is justified ?
I hope SS is ok
He is rarely not around after a major report ie IART comes out.
IART- maybe it goes bankrupt today ?
Sounds like investors think it is.
Updated portfolio
Cash $197,509
IART 8000 shares
Sell GERN @ $3.77
Sell 30000 GERN @ $3.77 = $113,100
Sell GERN @ $3.79
Sell 20000 GERN @ $3.79 = $75,800
R59- you pointed this out for HZNP
the whole way up from $20 to the buyout at $117. Not to say you don't have a point, but non gaap is the new normal, and that's what analysts go by.
IART- I am a strong buyer @ $25 !
There is no rational reason that the stock is getting killed this bad. I just don't get it. I listened to the entire CC today, and it seems the company expects their present products to do well, and is giving guidance of $3.01-$3.11 for 2024, with mid to high single digit growth in the second half. All of their products are doing well, so this is surprising to me for the stock to have gotten hit this hard. In addition, although there's no timeline, the company expects the Boston factory to come back on line at some point. I can't figure out why this stock is selling for a measly 8 PE going forward. I guess there's something I don't know, but from what I do know, the stock is very cheap.
R59- IART
Wadegarret tripled down at $26.75 avg this morning. I have no idea why a medical device company expecting mid to high single digit growth in the second half of this year would be selling for a 8 PE going forward. I think the stock is cheap
IART- Where is SS this morning ?
R59- IART
Guidance is for $3.05 avg for 2024 vs $3.19 last qtr. So about 4% less in eps than expected despite the Boston Factory off line till who knows when ? All their other products are doing well according to the CC with mid single digit growth expected in the second half of 2024. PE is now down to 8 going forward in an industry that carries 20-30 PEs going forward. I think the stock is very cheap here at $25
SS- IART
I'd like to hear your take. Is it a good buy @ $25 ?
Updated portfolio
IART 8000 shares
GERN 50000 shares
Cash $8609
Buy IART @ $24.75
Buy 1000 IART @ $24.75 = $24,750
Updated portfolio
IART 7000 shares
GERN 50000 shares
Cash $33,359
Buy AIRT @ $27.19
Buy 4400 AIRT @ $27.19 = $119,636
IART CC is now over- here is my view
I think the stock has been decimated to a 9 PE going forward vs the industry 20-27 PE going forward, for concern that without the Boston Factory, their earnings would go down substantially. However it appears to me, that with their present products, eps guidance is only down 5% from where it would have been even if the Boston Factory were back on line. Therefore, with $3.05 avg being guided for 2024, with all products doing well(excluding the 2 products made at Boston Factory), with mid to high single digit revenue growth expected in the second half, that a 9 PE going forward is cheap, and I don't think there's much downside from here at this point.
IART- Listening to CC
They said the Boston Factory will be off line for all of 2024, but they expect to still get it back on line at some point. All other products are doing well, and they expect continued growth with these products, with overall mid single digit revenue growth in the second half of 2024. They said margins will be slightly down for the inclusion of Boston Factory expenses. Balance sheet remains strong
IART- Boston Factory remains closed, but
their latest acquisition is doing well. Guidance overall for 2024 went from $3.19 to avg $3.05. Disappointed to hear the Boston Factory devices are no longer in guidance at all. Hard to know how to value the stock now, but very cheap at a 9 PE going forward vs the sector avg 20+ PE going forward. Here is the bad news...
Boston Update
Third-party audit yielded more findings than anticipated
Currently evaluating the timeline to address the findings and resume commercial distribution
Removing SurgiMend and PriMatrix from 2024 guidance
IART($28.90) out tomorrow morning
This stock has been severely hit, down persistently for over 2 years from $75 to $28. All this because of a 5 year(2018-2023) recall of one their medical devices, specifically made at their Boston Factory, which has been shut down for a year now. Will it keep tanking after earnings ? Well the company said in their last earnings report that the Boston Factory will be back on line by May or June. If this turns out, then the stock flies, and if not the stock will fall. However it's my position that this stock has been over sold. Time will tell
Value, that's a ridiculous analogy
I mean the stock price of a company is largely based on revenue and eps growth vs expectations of analysts. Expectations by analysts are respected to the extent that beating them or not(and more importantly- guidance) is what almost always dictates how a stock performs after it's quarterly report. On the other hand, a person or institutions(fund, etc) track record is always compared to the major indexes(mainly the S&P 500) during a given period of time, in judging success or failure. I've never heard of any other method. Also, the longer the period a person or institution has a track record to compare to, the more the results mean.
Value- SMCI
This article says they didn't meet revenue estimates...
https://finance.yahoo.com/news/super-micro-forecasts-quarterly-revenue-200957932.html
Value- SMCI
The stock was up over 1000% in one year when it hit $1250 ! The huge question is, as the growth slows, how does one re value the stock ?. I mean, during the huge revenue growth story up, the PE went from 10 to 40- However, now that SMCI posted lower revenues than expected for Q1 from "stiff competition", I believe it needs to be re valued. In other words, SMCI growth story likely saw it's peak, while they had a near monopoly. Now that they have stiff competition, why should the stock demand the same valuation ? It wouldn't. Therefore I believe it's hard to value SMCI right now. What we do know is, SMCI should no longer be valued at a 40 PE going forward. My feeling is, a PE of 20-25 at most is a generous valuation now that they have this stiff competition. With eps expected to be around $32-$35 going forward, I would be careful about giving the stock higher than a $700 target.
IART($28.90)- Wadegarret portfolio holding into earnings
Generally I don't like to hold, but this medical device manufacturer has gotten decimated. I believe the stock is over sold, and could go up 35%+ next week if things are any better than horrible ! They said in their last earnings report, that they expect the Boston Factory to be up and running again by June. However, when they delayed the Q1 report by 3 weeks, investors feared the worst, and sent the stock down another 15% ! So here we are, a $75 stock 2-3 years ago, and now $28.90 ! In the meantime, the company gave guidance of $3.19 for 2024, and analysts feel $3.60 in 2025, assuming the Boston Factory comes back on line soon. PEs in the medical device sector average 25 going forward !
Wadegarret portfolio- up 44% YTD/up 277% since 2022
Updated portfolio
GERN 50000 shares
IART 2600 shares
Cash $152,995