Good morning. You’ll receive your new Investment Digest this afternoon, and it’s full of brand-new investment ideas that haven’t been featured in Daily Alerts. But first, here’s one more Daily Alert recommendation, from The Periscope Report.
“We like to be ‘first in’ with our Top Recommendations. There are no independent research firms covering Mediware Information Systems, Inc. (MEDW, $14)and institutional ownership is low at 37%, which means we are first in. We also like to discover companies that are unique and are on the verge of a strong growth spurt. Mediware fits the bill.
“It provides blood management software systems that improve efficiencies and address safety concerns at healthcare organizations, enabling them to improve care processes while decreasing costs, which is paramount for healthcare companies who are seeing huge reductions in reimbursement from Medicare and Medicaid. One thing that stands out for MEDW is that it has $37 million in cash, or 31% of its market cap. Backing out the cash, the stock is trading for just 10.3 times our 2012 earnings estimate for $0.90 per share and 2.8 times its tangible book value.
“In other words, MEDW is an undiscovered growth company with cheap valuations. Plus, insiders own 38% of the stock and the insiders who work at the company have not sold a share in the past two years, which shows their allegiance. We think MEDW is in the perfect market position — its software helps healthcare companies manage the bloodwork side of their business, which is not their core function. Healthcare providers love helping people get better, but they hate the mundane operations. MEDW takes care of that (ahem) headache for their customers. MEDW software allows the doctors to do what they do best, cure people, while MEDW tracks, manages and collects all the bloodwork data. With numerous cutbacks in reimbursement from government and private insurance providers, MEDW offers a solution that is invaluable to its customers. It also makes MEDW intractable, an important trait for our Top Recommendations.”
- Tom Byrne, The Periscope Report, August 17, 2012