Angeion Corp. (NASDAQ–ANGN)-BUY

ANGN
Valuation-$13.67
Price October 12, 2007-$7.55

We are recommending ANGN for purchase. ANGN is trading at 55% of our valuation, which for a medical equipment maker is very unusual.

Angeion reported sales of $8.9 million in its third quarter ended July 31, 2007, up only 1% from the prior year. Gross margins were 50%., up slightly. Net income was essentially break-even for the quarter. Angeion sales had been benefiting from one large customer that represented $3.3 million in sales in last years quarter compared to about $1 million in the current quarter. Excluding this customer, their sales to other customers increased by 44% year-over-year. Also, net income was burdened by a number of unusual expenses in the latest quarter.

Angeion has only 4.2 million shares outstanding, and its market capitalization is less than one times annual revenue. It has traded from $5.62 to $18.50 over the last 52 weeks. It is unlikely that Q4 revenues will exceed last years ($10.70) million, so there maybe some time to buy this one.

With $1.19 a share in “net” cash (16% of the market cap), 50% margins, making money, we think this is a good bet.

The daily trading volume is 57,000 shares.

We think anything under $7.60 is a good price.

About Angeion Corporation
Founded in 1986, Angeion Corporation acquired Medical Graphics Corporation in December 1999. Medical Graphics develops, manufactures and markets non-invasive cardiorespiratory diagnostic systems that are sold under the MedGraphics (www.medgraphics.com) and New Leaf (www.newleaffitness.com) brand and trade names. These cardiorespiratory diagnostic systems have a wide range of applications in healthcare as well as health and fitness. The Company’s products are sold internationally through distributors and in the United States through a direct sales force that targets heart and lung specialists located in hospitals, university-based medical centers, medical clinics and physicians’ offices, pharmaceutical companies, medical device manufacturers, clinical research organizations, health and fitness clubs, personal training studios, and other exercise facilities. For more information about Angeion, visit http://www.angeion.com.

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