Cardiodynamics International Corp CDIC

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Cardiodynamics International Corp (CDIC)

• The Company that Sells Itself
• But Morgan Kotisa and Logan Middleton
• will sell it to you anyway

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Company Profile

• Develops, manufactures and markets non-invasive
  cardio, diagnostic and monitoring technologies
• Aids in clinical assessment diagnosis and
  treatment

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Stock Performance
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Company History

• 25 straight consecutive year over year quarterly
  revenue growth and increase in sales
• Actively involved in research and development in
  critical clinical trials
• Says no to drugs!!!

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Industry Outlook

• Healthcare is a 2.2 trillion industry
• Medical equipment and supplies is 319 billion
• Drug industry in a downward spiral after the
  withdrawal of Vioxx by Merck
• Many other companies being scrutinized and
  punished by the market over their products
• FDA approval will be much tougher in the future

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Key Success Factors in the Industry

• Very research intensive industry
• FDA approval is crucial for success, because
  without a product you dont have income
• Consistently obtaining FDA approval is a huge
  competitive advantage

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How is CDIC different?

• Non-invasive technology, replaces Pulmonary
  Artery Catheterization
• Cost effective alternative to surgery without
  affecting quality

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Products
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Metrics for CDIC

• P/E ratio
• current 55.41
• Forward looking 29.29
• Industry 33.6
• Market Cap 200 million
• Current Ratio 3.62
• PEG ratio 1.01
• DebtEquity - .18
• Beta 1.74

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Profit

• Revenue - 38.21 million
• Gross Profit 17.38 million
• EBITDA - 4.05 million (10.6)
• Cash 7.08 million
• Debt - 6.08 million

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Growth for CDIC

• Growth 42
• Just expanded sales force and developed new sales
  strategy for US
• Newly appointed V.P. of sales

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Competition

• Cambridge Heart Inc
• engaged in the research, development and
  commercialization of products for the
  non-invasive diagnosis of cardiac disease
• Not as well established sales generation
• Financially unstable

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Competition Cont

• Biomet
• Medtronics
• St. Jude Medical Center
• Edwards Lifesciences Corp
• Zimmer Holdings Inc
• Focus on invasive surgery

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Customers

• Large steady companies with worldwide
  distribution
• Directly to hospitals
• General Electric Medical Services
• Phillips
• Individual Patients and Doctors
• Allows patients to monitor themselves (ie
  pacemakers)
• Allows doctor to perform services that usually
  required hospital facilities

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Key Success Factors Going Forward

• Increase market penetration
• New VP sales
• Continue to develop state of the art technologies
• In the process of releasing Phillips ECG/ICG

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Risks

• Reliance on one key product stream
• Because of consistent growth, once this stops the
  market will punish them
• All future products are dependant on FDA approval
• P/E is really high

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Risks Continued

• The stock tanked even after 42 growth because it
  wasnt high enough
• Small fish in a big pond 1 of 262 companies in
  the medical equipment industry
• Although they have a patent it is still
  replicable
• Heavy investment in expansion has a possibility
  to be unsuccessful

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Addressing the Risks

• The stock is suffering from a big hit after
  expected growth was lower than expected, but we
  are buying it at a low
• Non-invasive technology will be less affected by
  stricter FDA regulations

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Recommendations/Action Plan

• We came up with a decision to buy this stock
• Looking at other high paid analyst opinions we
  realized that they say the same thing
• We must be really smart, listen to us and buy the
  stock