Natus Medical, Inc (BABY)

(23 November 2016)

BABY Business Overview

Natus Medical Incorporated designs, manufactures, and markets newborn care and neurology healthcare products and services worldwide.

AEO Fundamentals

  • Price to Earnings: 34.15
  • Earnings Per Share: $1.25
  • Market Cap: 1.4B
  • Current Ratio: 2.98
  • Return on Equity: 10.30%
  • Dividend Yield: 0%
  • Total Debt to Equity Ratio: 0.00
  • Consensus Target Price: $49.67 (Per Yahoo! Finance)

 

Balance Sheet ($ in Thousands)

  • Total Assets increased $31,219.
  • Total Current Liabilities decreased $12,044.
  • Total Equity increased $18,675.

 

Income Statement ($ in Thousands & for 9 Months Ended)

  • Revenues decreased $1,722.
  • Gross Profit increased $434.
  • Total Operating Expenses increased $3,481.
  • Income from Operations decreased $3,047.
  • Net income increased $2,98.

 

Cash Flow Statement ($ in Thousands & For 9 Months Ended)

  • Net Cash provided by operating activities increased $33,574.
  • Net Cash used for investing activating increased $27,957.
  • Net Cash used for financing activities increased $18,532.
  • Cash and Cash Equivalents at the end of period decreased $1,128.

 

Business Acquisitions from 10-Q

  • “On July 6, 2016, we acquired the portfolio of RetCam Imaging Systems (“RetCam”) from Clarity Medical Systems, Inc. for $10.6 million in cash.”
  • “On March 2, 2016, we acquired NeuroQuest, LLC (“NeuroQuest”) through an asset purchase.”
  • “We acquired Monarch Medical Diagnostics, LLC (“Monarch”) through an asset purchase on November 13, 2015.”
  • “We acquired GND Operating LLC, and Braincare, LLC (collectively “GND”) through an equity purchase on January 23, 2015.”
  • “On January 2, 2015, we purchased the assets of Health Observation Systems, LLC (“NicView”) for cash consideration of $1.1 million, of which $0.3 million was allocated to tangible assets and $2.7 million to goodwill, offset by $0.6 million allocated to net liabilities.”

 

Entry Points

  • $38
    • It has solid support at the $38 mark going back into August of 2016.

Exit Point

  • $51
    • I say $51 because it reach $51 back in December 2015, and has since then failed to surpass even $45.

 

Final Thoughts

  • I am bullish on BABY and would buy at $38. The reason why I am hesistant to buy now is because it just came down from heavy resistance at the $44-$45 price range, so it has more room to trade lower before reconsolidating at that lower price range before heading back up.

 

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