5-Hour Energy: A Success Equal Parts Caffeine, Chemistry and…
How State Taxes Put a Bigger Pinch on the PoorSonoSite (NASDAQ: SONO) develops,
manufactures and distributes hand-carried ultrasound systems for use in various medical specialties and clinical settings. The firm's devices range in size from small handheld units to laptop-sized systems and allow for point of care analyses where larger, cart-based machines may be too cumbersome. SonoSite systems support work in anesthesia, cardiology, critical and acute care, emergency medicine, OB/Gyn, radiology and surgery. Products are sold through direct sales representatives, third-party distributors and strategic alliances.
The company pleased investors earlier in the week, when it guided Q4 revenues to $65 million and FY07 revenues to $205 million. The Street had been looking for $62.80 million and $203.3 million, respectively. In discussing the solid numbers, the CEO noted positive market responses to five recent product launches.
The stock popped on the news and then began consolidating the gain in a bullish "pennant" pattern. Equities frequently exit pennants moving in the same direction they were traveling on entry. In this case, that would be to the upside.
Brokers recommend the issue with four "buys" and one "hold". Analysts see a 63% average annual growth rate, through the next five years. The SONO Price to Sales ratio (3.13), Price to Book ratio (3.28), Sales Growth rate (24.07%) and EPS Growth rate (200.00%) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 95% of the outstanding shares. Over the past 52 weeks, the stock has traded between $26.50 and $37.25. A stop-loss of $31.90 looks good here. Note that the firm is expected to announce Q4 results on February 14th.
Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold a position in the stock discussed above.
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