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Vascular Solutions Inc. Message Board

  • eu9mec eu9mec Apr 13, 2012 8:53 AM Flag

    VASC is oversold

    This is a great time to get in or accumulate more VASC. If you take a look at the financials and guidance for the quarter, VASC should have no problem hitting first quarter guidance. They should be at top of range for revenue and exceed on eps. My estimate is 22.7 million on revenue and .13 on eps.

    Should jump to $12+ after earnings, depending on Q2 guidance. However, I would assume solid Q2 guidance based on ClosureFAST (take this for what it's worth, but there are some posts from purported Covidien reps saying that reprocessing is having an impact on their ClosureFAST sales).

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    • Thanks.

      I actually have listened to the last four but remain unconvinced. I have still yet to be see the catalyst that will drive the stock forward.

      The hemostat products have been the drag with a huge chunk of declining revenue that offsets the more promising catheter product revenues.

      I do agree, however, that the company is well managed. The balance is strong. The CEO strikes me as knowledgable as well. But I always come back to asking: Where is the catalyst that will significantly offset the hemostat revenues?

      I seriously doubt that ClosureFast will be a significant revenue driver. If it will be, then I will await confirmation and stay on the sidelines for now until I review the next earnings report.

      Good luck to you!

    • No, I am not in the medical field, but I've been following this stock for some time. The first thing to know is that the CEO, Howard Root, is very knowledgeable--if you have the time, go on the website and listen to one of their conference calls.

      Regarding ClosureFAST, yes, you're right, VASC is simply acting as an intermediary. I'm guessing the margins here are around 40%. I'm optimistic because they signed up so many doctors in two weeks time (I think somewhere around 4% of the doctors)...projecting that out, I'd think they'd have 25% of doctors signed up by end of March. Now market size: I don't know this but I'm estimating the whole market is about $25-30 million for VASC (that is, if VASC signed 100% of doctors and all used the reprocessing, they would generate 25-30 million of revenue). If I'm right about 25% of doctors at March 31st, then Q2 should result in >$1 million (25% x 25 million/4 x 90% yield x 75% use:signup ratio). An extra 1-1.5 million would have a big impact on VASC stock.

      I don't think ClosureFAST will have much other benefit on cross-selling and there's no cannibalization of VASC products here.

      The drop in quarterly revenue, Q3 to Q4, had to do with the end of an agreement, so a one-time event.

      If you are looking at this company, this is a great time to research and get into it. Earnings are next week on Tuesday. I suspect that people are little wary of the stock right now because it has disappointed. I think management gave good revenue guidance but low earnings guidance for Q1. It should exceed on eps.

    • They got hit with a $3M+ settlement with a doctor. It's in the 10Q. It will be reflected in last Q's numbers possibly as a one-time item. Nonetheless, the stock may suffer for a little longer because the growth rate is not, imo, at par with the stock valuation to make it attractive. Until they can grow their declining products, the market will not take this stock much further, imo. I have actually been surprised that the stock has not been hit harder. We'll see during the coming days/weeks when volatility will be back to haunt the market, imo.

      • 1 Reply to marlin_cabo
      • What $3 million settlement? The only one I know about is one from 2008. Is this another one? Can you provide the verbiage or link to the settlement you're referring to?

        If you look at the financials from last year Q1 v. Q4 plus add in new ClosureFAST revs, I think you'll get to the same conclusion: high end of guidance...on the eps side, if you assume about 65.2% gross margin and opex of $11.2 million, 37.4% tax, you get to .13 eps. For Q2, the company will have to rely on ClosureFAST growth the get revs moving significantly.

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