BEAT beats! LOL

GAAP accounting is doing investors a great disservice by making the financial statements close to useless. You have to back out a bunch of useless garbage that some jackass in an ivory tower (FASB) thinks is good for clueless investors. After you compare BEAT’s GAAP financial statements with the “Company Highlights” of the press release you have to wonder if they are talking about the same company. To resolve the discrepancy you have to listen to the conference call where they explain some of the differences.

One of my important metrics is gross margin, GAAP gross margin fell. Another important and related metric is the conversion of revenue growth to EPS growth, revenue up, EPS down sharply. If I had to rely on GAAP financial statements I would drop BEAT in an instant. Yet Mr. Market gave it a big thumbs up and the business model and the conference call support Mr. Market’s stance.

BioTelemetry, Inc. Reports First Quarter 2017 Financial Results
GlobeNewswire May 3, 2017

MALVERN, Pa., May 03, 2017 (GLOBE NEWSWIRE) – BioTelemetry, Inc. (BEAT), the leading wireless medical technology company focused on the delivery of health information to improve quality of life and reduce cost of care, today reported results for the first quarter ended March 31, 2017.

Company Highlights

- Recognized highest quarterly revenue in Company’s history of $55.9 million, a 14.9% increase over the prior year
- Achieved 19th consecutive quarter of year over year revenue growth
- Serviced the highest quarterly patient volume in the Company’s history
- Recorded GAAP net income of $0.2 million and adjusted net income of $4.9 million
- Realized quarterly adjusted EBITDA $10.8 million, a 19.4% return and in line with expectations
- Announced $260 million offer to acquire LifeWatch AG

https://ca.finance.yahoo.com/news/biotelemetry-inc-reports-f…

Denny Schlesinger
LONG BEAT

Financial Accounting Standards Board (jackasses in an ivory tower)

http://www.fasb.org/facts/

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The shares are down by about 19%, not sure why. I do not understand your comment, ‘Yet Mr. Market gave it a big thumbs up and the business model and the conference call support Mr. Market’s stance.’ Are you referring to the situation before the conference call?

Regards.

alpha
(Recently bought some shares)

1 Like

I do not understand your comment, ‘Yet Mr. Market gave it a big thumbs up and the business model and the conference call support Mr. Market’s stance.’ Are you referring to the situation before the conference call?

I was referring to the pre-market rise in the stock price. Now Mr. Market is reacting to the GAAP results.

When I buy a new stock I also sell a covered call as a hedge. I just bought it back lowering my cost basis by 2%. Better than nothing.

Denny Schlesinger

Thanks for the clarification. I am with Fidelity and I should perhaps join their options trading facility and learn about covered calls. I believe writing covered calls may be relatively easy to learn without having to go into other features of options trading. Any suggestions?

Regards.

Any suggestions?

Before Saul runs us out of town, let’s take the options discussion to the options board. :wink:

Options - You Make the Call
http://discussion.fool.com/Messages.asp?bid=113013

See you there!

Denny Schlesinger

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let’s take the options discussion to the options board. Options - You Make the Call
http://discussion.fool.com/Messages.asp?bid=113013

Thanks, Denny.

Saul

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I just read the transcript of the conference call, and I could have missed something but I don’t see anything in there to cause me concern. What did I miss??

I just read the transcript of the conference call, and I could have missed something but I don’t see anything in there to cause me concern. What did I miss??

Nothing in the CC. The problem is in the P&L statement. TMF said the same thing I did:

However, gross profit margin did slip to 59% from 63% in the past year, and general and administrative expenses grew faster than revenue, increasing 29% in the first quarter versus last year.

https://www.fool.com/investing/2017/05/04/why-biotelemetry-i…

which was explained away in the CC. I think the sensible thing to do now is to wait for the next earnings report and to see how the tender offer for LifeWatch goes. That’s what I’m going to do.

Denny Schlesinger

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Buy the dip in BEAT, say analysts

https://seekingalpha.com/news/3264268-buy-dip-beat-say-analy…

“”
It’s a buying opportunity, Dougherty’s Gene Mannheimer tells Bloomberg. The LifeWatch deal is still very much intact, and investors should consider a particularly tough comp BEAT had this quarter.

He reiterates his Buy rating and $37 price target (32% upside).

Lake Street’s Bruce Jackson echoes those sentiments, and reiterates his Buy rating and $30 price target. His “back-of-the-envelope, aspirational” PT would be north of $40.
“”

alpha

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There are two concurrent threads in BioTelemetry, the business model which looks terrific and the financial comparisons, lower gross margin and growing GS&A spending, which can kill profits from even the best business model. You can’t just look at one or the other, you got to figure out which one will win.

Buy the dip in BEAT, say analysts

First thing I did today was to look at the dip. It closed the April gap, something traders expect. I compared the going price with my cost basis and the dip was not enough to convince me to buy. My cost basis is $29.97.

Right now I’d like to see the LifeWatch tender offer go through. I don’t yet know if this is a winner-take-all or a commodity business but being the biggest player is aways a good idea. Years ago I read an article about reading PR releases. Everyone calls himself “a leading” player but only one can say “the leading” player. Check it out:

BioTelemetry, Inc. Reports First Quarter 2017 Financial Results
GlobeNewswire•May 3, 2017

MALVERN, Pa., May 03, 2017 (GLOBE NEWSWIRE) – BioTelemetry, Inc. (BEAT), the leading wireless medical technology company focused on the delivery of health information to improve quality of life and reduce cost of care, today reported results for the first quarter ended March 31, 2017.

https://ca.finance.yahoo.com/news/biotelemetry-inc-reports-f…

Denny Schlesinger

2 Likes