Tuesday, 14 August 2007

LMS, Holding Strong

Claude Camire of Paradigm Capital Inc. reports LMS Medical Systems (LMZ - TSX / AMEX) Q1 results: "slowly but surely".

Paradigm reiterates what we have been telling the market, that LMS is well positioned and is the only player in the field of obstetrics. Obstetrics is a giant, stable business that is largely untapped. Even with Q1 results being slightly lower than forecasted, Paradigm expects the revenues to meet the estimate of $7.0 m. Obviously they believe traction will continue and make up for any shortfalls for the year. Despite our difficult markets , Paradigm is keeping its' revenue estimates intact for FY08 at $7.0m. and maintains its BUY rating with a 12 month target of $2.25.

LMS has reported an increase in backlog of signed and recurring contracts from $4.4m in the last quarter to $4.6m. Paradigm believes that it is only a matter of time and efforts before LMS gains wider customer acceptance.

The next 6 months will be worth watching.