Novadaq Reports First Positive Earnings Quarter & Stock Ends Day at $12.24 In Heavy Volume
I have no insider knowledge but there are signs indicating Novadaq adoption is very strong, stronger than analyst expect.
Short Term Financial Surprise:
ISRG sales of FireFly increased from 64 to 88. Novadaq company projections indicated 100-110 unit sales from ISRG and LifeCell combined. Last quarter LifeCell sold 44 SPYElites, expect 64 this quarter for a total 152 units vs the 110 upper end of expectations. PinPoint launch will also move the expectation needle though it is too early for material financial impacts. Lastly there will be $2 Million plus onetime giveback of Warrant cost that hit NVDQ for $8.1 million in non-operational expense last quarter.
Long Term Stategic Progress Surprise:
Look for conference call indications of progress with KCI/Luna and rollout of PinPoint to change the trajectory of this companies results.
If both the short term financial results and the strategic longterm progress are present tomorrow expect very heavy volume (greater than 1 million shares) and day closing stock price above $12.24.
I would agree that the company seems positioned to report a much improved 4th quarter across the board. There is however one area that worries me. The short position has grown rapidly over the past 6 months from only 13,000 shares in July of 2012 to 1,066,000 on January 15th. These folks will do everything in their power to undercut the pps tomorrow. On the other hand, the RSI currently stands at 47 halfway between being overbought and oversold. It will also be interesting to see how much kit sales grew in the 4th quarter.
The modelling I use projected 37% revenue growth vs 37% actual, 152 units vs 135 (~150 shipped according to CC). ISRG installed ~12 on existing machines from inventory. The progress on PinPoint (2 sales & marketing up to 15) was good with cash drain in next 6 months but contributions in second half (CC comment to question & answer inquiry), as well as more opaque progress on LUNA. All in all just about what expected. So why did the stock not respond? My wife hates the impacts of short sellers. You may have put your finger on it endo. Like ISRG in the early days, short sellers have little long term impact. Management stated "40% plus growth for years to come are expected".
let's see you have no insider knowledge since you don't work at NVDQ..and may not have a 3rd cousin who knows the janitor's 13th cousing who knows the garbage man's exwife who lover worked at NVDQ in 2011. But you have an, ahem, price target of $12.24 at close of day.
Well by God we applaud your forthright right to believe , predict and go out on a big but possibly cracked limb to defend what you believe. GUTS More than most wimpies on MBs have. Good 4 U