Cardiac Science Corporation (NASDAQ: CSCX) provides a family of diagnostic and therapeutic cardiology devices and systems, including electrocardiographs, stress test systems, Holter monitoring systems, hospital defibrillators, cardiac rehabilitation telemetry systems and cardiology data management systems. The company also sells a variety of related products and consumables and provides a portfolio of training, maintenance and support services.

The firm pleased investors earlier in the week, when it guided Q4 revenues to $50 million. Analysts had been expecting $46.20 million. Management also said that FY07 revenues would exceed $181 million ($177.90M consensus). In discussing the upside adjustments, the CEO particularly cited growth in the cardiac monitoring line and contributions from a new crash cart defibrillator product. CSCX shares popped on the news and then moved into a bullish "flag" consolidation pattern. Prices frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the shares with one "strong buy" and one "buy". Analysts see a 46 percent growth rate, through the next year. The CSCX Price to Sales ratio (1.22), Price to Book ratio (0.93), Price to Cash Flow ratio (16.36), Sales Growth rate (18.44%) and EPS Growth rate (-0.01 to 0.08 yr/yr) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 70 percent of the outstanding shares. Over the past 52 weeks, the stock has traded between $7.35 and $11.50. A stop-loss of $7.95 looks good here. Note that the firm is expected to report Q4 results in late February.

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.

Cardiac Science Corporation: Shares forming a bullish 'flag' pattern originally appeared on BloggingStocks on Fri, 11 Jan 2008 13:22:00 EST. Please see our terms for use of feeds.