Replies to post #78020 on Biotech Values

[microcapfun]

>>You could’ve sprung that quoted passage on me and won some serious money (like a 3-month iHub membership)<<

I'm impressed, Dew. I didn't realize you had such a highly developed sense of humor.


>>you have yet to furnish one good reason why ISRG reported the procedure count for 1Q09 and the procedure count for full-year 2008, but not the procedure count for 4Q08. What possible reason for such selective reporting can there be other than management's being embarrassed by anemic quarter-over-quarter growth? <<

They decided to provide an additional number (Q1 procedure number) that they don't usually give in order to give investors more information about the state of their business during these difficult economic times. And you get suspicious because they didn't give yet another number that you would like (Q4 procedure number). Big deal.


>>What possible reason for such selective reporting can there be other than management's being embarrassed by anemic quarter-over-quarter growth?<<
>>my suspicion is that ISRG’s business is showing signs of flatlining and management is going to great lengths to mask this from the investment community<<

Well you are wrong - and I can prove it.

From the Q1 cc:
>>The amount of instrument and accessory revenue we realized per procedure including initial stocking orders and adding back the deferred revenue of $2.1 million was approximately $1800 per procedure, down approximately $200 per procedure compared to the fourth quarter<<

There are two other numbers that we need to calculate the sequential procedure growth rate.
Q4 I&A revenue was $81.575M, and Q1 I&A revenue after adding back the $2.1M (obviously they are rounding off) in deferred revenue was $81.663M. The I&A numbers are in the SEC filings.

If we call the Q1 procedure number n1 and the Q4 procedure number n4, we have ...

n1*1800 = 81663000
n4*2000 = 81575000

Dividing, n1/n4 = 1.11231, i.e. sequential procedure number growth was 11.2% ... which is 53.1% annualized.

Of course there are some roundoff errors (e.g. 1800 might be 1820), so the true number could be a bit higher or lower.


>>I’ll bet you a 3-month iHub membership that they don’t grow full-year 2009 procedures by as much the 50% you expect. Ok?<<

I'd prefer something more useful ... like a t-shirt, but O.K. Dew. (I could probably get a 3-month trial membership for free, right?)

Cheers,

micro