Vycor Medical Inc (VYCO)

[$tock Princess '17]

• The Company Should Enter Hyper-growth During the Next Two to Three Years
Vycor's ViewSite is already making good inroads into the relatively small neurosurgery
market, both in the U.S. and overseas, and we expect sales to grow robustly beginning in early
2013. However, we are most excited about the long-term potential of the NovaVision
subsidiary, as its products have no real competition and address a global market that could be
up to $20B in size. Although NovaVision's products could require several years to achieve
market penetration of even 5%, this would still equate to a huge win for a company of this size.
Both NovaVision and ViewSite have strong patent protection and backing from the scientific
community, and both are FDA 510(k) cleared for sale in the United States.
• We Believe an Investment in Vycor is Somewhat Risky but Has Exceptional Potential
Based on solid near-term growth prospects and extreme upside in potential in 2013 and
beyond, we are initiating coverage of Vycor with a Strong Buy rating and a target price range
of $0.05 per share. Assuming the Company executes on its plan over the next 12-18 months,
we believe its current valuation multiple of just 4.2x our 2013 revenue forecast is far too low,
and believe a multiple in the 12x to 15x range is more appropriate. Furthermore, we see upside
to our estimates if NovaVision is able to achieve market penetration more quickly than we
foresee.