S.A. Advisory E-Mail Update
July 27, 1999
Subject: New BUY RECOMMENATION from www.saadvisory.com for July 27,99-TMED
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NEW BUY RECOMMENDATION
Trimedyne Inc. ( nasd--TMED) current price $2.03
Corporate phone # 949-559-5300
10.9 million fully diluted shares outstanding
1 million held by management
9.9 million shares free trading
As of March 31,99--$7.7 million in cash and marketable securities
Total stockholders' Equity-$12.4 million
LTD--ZERO
NOL--$30 million ( HUGE!--Company shielded from taxes for ever!)
52-week range--.625-$3.00
During Dec 98 received $6.5 million from C R Bard from settled lawsuit
During Jan 94 TMED reached all time high of $18.00
The Company: A leading manufacturer of surgical lasers.TMED manufactures a family of Holmium
and Nd: YAG lasers for use in urology, orthopedics,ENT surgery, gynecology and
general surgery to treat a variety of diseases and medical conditions.
We became really excited about this situation on July 22,99 when the company received
FDA clearance to market its new Side-firing Holmium Laser Needle!
According to the press release: TMED received clearance from the FDA to commence marketing
its Omnitip Side-Firing Needle, commonly referred to as the "Knight Needle"
The principal use of the Knight Needle will be to vaporize a portion of a herniated
lumbar spinal disk in a minimally invasive procedure, reducing the volume of the disk.
When a spinal disk develops a herniation, the resulting bulge presses against the nerves
in the spinal column. This causes lower back and leg pain, a condition affecting millions
of people within the US.
The Knight Needle was developed jointly by TMED and M. Knight, one of the world's most
renowed orthopedic surgeons. In addition to decompression of herniated lumbar spinal
disks, the Knight Needle has been cleared for sale for a wide variety of surgical
applications, including the incision, excision, vaporization, ablation and coagulation
of tissues in arthroscopy, urology, ear-nose-throat (ENT) surgery, gynecology and general
surgery.
The Knight Needle contains a suction/irrigation channel which can be connected to an
external pump, providing surgeons with the ability to withdraw flid or administer drugs
or fluids of their choice before, during or after the laser procedure.
THIS IS BIG STUFF! THE MARKET POTENTIAL IS HUGE! THE PROCEDURE OFFERS A MORE COST-EFFECTIVE
CHOICE FOR BACK-SURGERY CANDIDATES. LESS RECOVERY TIME, PAIN AND THE ABLE TO RETURN TO WORK
MUCH FASTER. INSTEAD OF A 2.5 INCH CUT FROM STANDARD PROCEDURES-- ONLY 1/8 TO 1/4 INCH CUT-
LESS TRAUMA!!!!
On July 16,99 TMED announced that a patent was granted by the US Patent and Trademark Office,
which covers TMED's ( 90% owned Cardiodyne Inc. subsidiary) new Laser Transmycocardial
Revascularization (TMR) System, which is designed to create channels in the heart wall, using
TMED's Holmium "cold" laser in less than 1/2 second, during diastole, when the heart is
momentarily at rest. The channels enable blood from the chamber to perfuse the heart muscle
and the growth of new blood vessels, which is seen around the laser created channels, increases
the distribution of blood in the heart muscle. The TMR System is fully automated and
synchronizes the channel making procedure with the patient's ECG. When the surgeon positions
the device and presses a button, the optical fiber, which is encased within a short length of
syringe needle, pierces the outer portion of the heart wall without activating the laser.
The laser is then activated and the fiber/needle advances through the remainder of the heart
wall into the chamber, creating the channel. The AutoFire System is designed to also inject
genes or a growth factor to increase the angiogenic effect, if desired, as the fiber/needle
is withdrawn. When the fiber/needle exits the heart wall, bleeding from the needle puncture
is minimal, enabling the procedure to be performed with a scope through a puncture between
the ribs in a minimally invasive, endoscopic procedure at lower cost.
TMED is also involved with many other medical research, which will be discussed at a later
date.
Overview; The company is financially sound and fundamentally very cheap! The market-cap
is very small when one considers the HUGE potential of recent FDA approval. TMED is
relatively unknown and underfollowed and trades on the NASDAQ. The stock has been basing
for many years and in our opinion is ready to trade higher! We intend to monitor TMED in
our portfolio for % gain performance. It looks like a great trading stock as well! TMED
has no debt, lots of cash, a Huge NOL, promising products, small market-cap and appears
to be ready for rev and earnings growth.
We have not been paid by TMED for our recommendation! We may also trade TMED for short
term profits as well as HOLD a position for long term gains.. A great core holdings for
micro-cap portfolios.
2. Homeland---HMLD current price $3.625--77 stores-supermarket Strong BUY
We currently own HMLD ---have recommended it before--see http://wwww.saadvisory.com April-May
99 newsletter!
Safeway to acquire Texas Food Chain--Randall's Food Markets--116 stores. Safeway
pays $1.8 billion for annual sales of $2.6 billion ( Randall's)
Homeland's stores located within same SW region. Est rev for 99 around $600 million --If
Safeway bought them instead for the same % of rev --HMLD would have been taken out at
over $8/sh!!!!FOOD for Thought!!!
Consolidation in the sector is intensifying as chains try to beef up to ward off the
competition.. Right now there are more than 25 public or private chains with over $1
billion in annual sales that are considered potential targets! This bodes well for HMLD!
HMLD in our opinion is a great core holdings ---looks like a takeover candidate!!
Broker contact: Greg Nelson 1-800-269-9460
3. Teltran International tltg See April/May 99 newsletter for initial recommendation
on Feb 17,99 @ $1.40--proceeded to place a 30% SELL recommmendation on tltg on
July 1,99 @ $12.69 (profit motive). At present the company intends to raise additional
working capital by selling 6 million shares to the public at some time in the future.
In addition, the 8 million shares that were restricted will be "free" trading and portions
of this may begin to filter into the market-place. The over-hang will be large!! We
believe that TLTG near term will head lower--maybe $5/share.. The present price is
$8.75---WE ARE PLACING A SELL ON ANOTHER 30% INORDER TO LOCK-IN MORE PROFIT! We still
like the company, but our only motive for investing is profit-NOT MARRIAGE!!!
4. ARTM should be releasing earnings very soon-should brake $1.00, YARC-our opinion a sleeper-
should own some, MCTL great speculation( see latest newsletter), PCSN earning should be
out soon--stock should head higher.
We have not been paid by any listed investments. We may own all listed opps and may
buy, sell and or hold them . We are a trader by nature, but also invest for the long-term!