Tuesday, 17 June 2008

Paradigm Capital Looks Favourably On LMS Medical Systems

LMS Medical Systems (LMZ - TSX)

Shares outstanding: 25.8m

Fully Diluted: 30.7 million


Claude Camire, Senior Healthcare Analyst for Paradigm Capital acknowledged in his update entitled, “This Baby is Growing Again”, that LMS' recent financial results far exceeded his estimates.

The analyst noted that LMS beat his Q4F08 (March 31) revenue projection of $1.2 million by $1.1 million ($2.3 million or 91%). While Mr. Camire didn't change his 12 month target price of $1.25/share he also stated that the Q4 loss was much better than he expected coming in at $0.01/share versus his call at $0.05/share.

For the first time in two years Paradigm raised its revenue estimates for F09/10 and it also acknowledged LMS for increasing system installs to 93 from 53 hospitals a year ago. "This is the first time in the last 2 years that we are increasing our revenue estimates. Our revenue estimates are moving from $5.8m/$10.1m to $7.5m/$11.2m respectively for FY09/10."

We must add that in a recent news release concerning its audited F08 (March 31) year end results, the company said it expected to double revenues in F09. As F08 came in at just under $5 million, this would put LMS near $10 million for the current fiscal year and well above the analyst's call.