CTE

[fous]

Cardiotech international is a company that develops devices to surgically treat cardiovascular disease. Yesterday was a huge day for CTE, The FDA cleared approval for CTE's Heparin-coated Auto transfution and Cardiotomy products. The stock rose $1.22 which is was a gain of 69.32%! Even more after hours trading occurred and went up another $0.22/7.38%.

Volume is outrageous with avg volume at 66,900, Yesterdays volume was a staggering 2,241,200 and with a market cap and 57m this company has plenty of room to grow and indeed i think it continue to do so.

What is their new product?

-The GBS(R) (Gish Biocompatible Surface) Coating is a proprietary covalently bonded heparin based coating developed at Gish. GBS(R) is a biocompatible coating and is composed of heparin and hyaluronic acid, or hyaluronan. Hyaluronan is a hydrophilic biopolymer that occurs naturally in the human body. Because it is found in extracellular matrices, is blood compatible and lacks immunogenicity, hyaluronan is a perfect coating for blood-contacting applications.

Potential Market?
Coated heart lung bypass products in in the US have an estimated potential market of 250m annually and 500m annually worldwide. CTE currently in business with 300 hospitals world wide and believes there new full line of GBS products will expand there market share in heparin products. There next goal is to expand internationally to the European union which has a much larger demand for the GBS coated products. CTE has already started this process and plan begin selling GBS coated products to the European market in the first quarter of 06'

Hold on, Theres more!
- CTE is also in the process of 2 other ventures both with a 1 billion annual market.

- CTE is already conducting human clinical trials with a synthetic coronary artery bypass graft which has a $1Billion annual market

- CTE has also teamed with Implant Sciences and Cornova to develop a drug- eluting stent that addresses a $1 billion international market.


Short term there will likely be some profit taking though in the long haul this could develop into a BIG % gainer

WITH SUCH A BIG GAIN IN ONE DAY, THIS CHART JUST LOOKS WEIRD, BUT I LOVE IT!

I've been watching CTE and waiting for a bullish breakout of the decending trend line and man-o-man did we get one on massive volume.

[fous]

CTE had a healthy technical pull back today on yet another record Volume. being that it had such a large % gain yesterday and opened roughly $.50 above the prior day close, im not surprised at all to see many people interested in taking profits and others chasing this piping hot steam engine. I havn't made a open position yet but here is my plan for when to do so.

Plan A:
-If the gap isn't filled with a "close" below 2.99 within the next 2 trading sessions i will give myself the opportunity for an open position

Plab B:
If the "sort of" gap(since its already been filled with CTE's wide trading range today of $.81) is filled within the next 2 trading sessions i will follow the pull back closely and wait for a sign of a reversal to make my entry.

Good Luck everyone,
Man i love this forum!

-fousc

[rocket8]

couldn't u have told me about this stock two days ago? 

1.  what price are you hoping to buy in at?

2.  isn't the marketcap of $59m still very low?  can it go to $10 ?

-rocket8

[fous]

Haha yes rocket i wish i would have been watching intraday and bought sometime shortly after the open once i saw the news and the sky rocketing price past my decsending trendline. Though im not a fan of intraday anymore as all it has done for me in the past is help me lose money. So now i stick to end-of-day TA and mainly buy/sell at openings and closings.

1. what price are you hoping to buy in at?

-Considering plan A i believe that if it doesn't close below the gap at 2.99 i think i will make a sharp rise upward so i will get in as soon as i can if this stock goes according to plan A. what price that may be i dont know. Who knows the stock might go up 1$ tomorrow. There was alot of selling pressure today with the high at $3.70 and it closed at $3.07 and could be considered a spike day and a healthy technical pullback has begun, which is what i would prefer.

-Considering plan B i would prefer to get in around the low 2.60's high 2.50's. Though i would settle with anything around between 2.50 and 2.70. The Next support after the gap would be at around 2.66. So this would probably be the time to start looking for and open posotion in light of plan B. Reasoning displayed on chart below.

2. isn't the marketcap of $59m still very low? can it go to $10 ?

Yes at 59m this company is considered a micro cap and has much potential for %gain and can rise fast, yet they can also decline very fast if not faster. As far as it going to $10 i do not know. Technically i don't see any patterns that project it to 10$. And im not much of a Fundamentals guy(yet) ;Dworkin on it. But in this news release it looks like they got big plans for the future and $10 could be in reach. Revenues from there new GBS products will start flowing in soon and they plan to begin to distribute to the European market in Q1 06'. As well as the two future billion dollar markets CTE is soon hoping to enter tells me nothing but good things for the future of this company. As long as everying pans out.

Here is the news that gave that Beautiful 69% rise
http://biz.yahoo.com/ap/050907/cardiotech_mover.html?.v=3

[Michael]

Hi Fousc

Thanks for an excellent recommendation (applauds!) and also thanks to Louis for pointing me in this direction 

I love the fundamentals so I am going to buy today. This stock has been a favorite target by the short community for a long time and it seems like they are out in full force today so I hope I can get in at a nice discount. (2.75)

Mike

(and my order got filled while i was writting  )

[fous]

Glad to see Michael likes the fundamentals, I was hoping you would notice this pick and take a look at them since i don't know much yet about it. As well, It seems like it's always a good thing when Mike decides to hop on board. Applauds to you.

"Show me the Money"

-fousc

[fous]

The bears controlled the game today just as i had hoped for Plan B. Selling pressure continued until it hit my exact support line at $2.66(once again could have benefited from watching intraday, but hey, woulda shoulda coula ) and was met by more buyers to close at $2.83. Will the support line be met on Monday? maybe not! Ill watch closely on monday to fill in a position, If we have a white day on monday i will purchase before the close.

Good luck all
-fousc

[Michael]

Hi Fousc.

Thanks for the trust in my picks but I think it is in place to remind everybody to do their own due diligence before buying a stock. The only thing that can be guaranteed about CTE is that the way forward is going to be very volatile.

As mentioned previously CTE has been a favorite target of the short community and was on the naked short list back in April. It can however be very profitable to bet against shorts if you are confident about the fundamentals and I am confident about the fundamentals.

The FDA approval for its transfusion and cardiotomy reservoir products significantly improves their competitiveness in an approximately $500 million market (remember CTE's market cap is only $54 million). European approval is expected in Q1 2006 which should give a new boost to the share price (it is very unlikely that Europe wouldn't give the approval now when FDA has approved the product).

It is obviously important that the spike on September 7 was backed by fundamentals but that is however not the main reasons why I like the stock.

CTE's lead product is artificial blood vessels to be used in bypass operations (Cardiopass). This is a $1.5 billion market and the only alternative is the patient's own arteries. Most people Obviously prefer their arteries to stay where they are in the first place but that is not the main problem. The main problem is that we are all born with a limited amount of arteries suitable for by pass operations and after a by pass operation the veins start to deteriorate and many patients end up with no blood vessels available for a repeated by pass operation, which obviously has catastrophic consequences. Nearly 100 000 people dies every year in US due to the lack of artificial veins.

All previous attempts to develop synthetic blood vessels have failed but CTE seems to have found the solution. Three patients have already lived more than 2 years with Cardiopass and they are planning to enroll more patients in clinical trials in Europe and South America.

The next big trigger for a spike in the share price is start of phase II test in Brazil. CTE expected the approval of Phase II trials in mid 2005 so we will hopefully soon hear news about this and the clinical trials in Europe.

CTE is however not a one shoot Biotech company. Not only do they have several other products in the pipeline but they also have an existing healthy business that helps finance the development of their pipeline. In fact they expect to be cash flow positive in the near future even without Cardiopass.

CTE is a medical device contract manufacture This is a $1 billion market in US alone and growing at an estimated 15-25% annual rate. Their biomaterials expertise, and plastics assembly capabilities give them and excellent opportunity to be a leader in the specialized areas of cardiovascular, orthopedics and therapeutic minimally-invasive contract manufacturing. Management mentioned in the last earnings report.that they are stepping up production for a significant contract, which should significant contributes to future operating results.

The balance sheet is very healthy with no debt and $7.5 million in cash.

I received a message over the weekend asking me what my target is for CTE. It is difficult to put a target on Biotech companies as it obviously depends on the development of the pipeline. Based on their existing business and the state of their pipeline I would have a market cap target of $135 million (5 times sales). The target will obviously be much higher if/when Cardiopass gets FDA approval (or European approval, which probably will come sooner). A $30 POS seems to be conservative. That would after all only give them a market cap of around $500 million with a monopoly on synthetic arteries in the $ 1 billion CABG market.

Mike

[la-onda]

in @ 3.02 $ 


fyi:
Wall Street Resources, Inc. Adds Cardiotech International, Inc. to Its "Companies of Interest" Watch List

Thursday , September 08, 2005 09:46 ET

Palm City, Florida - September 8, 2005 (Knobias-EventX) - Wall Street Resources, Inc., adds Cardiotech International, Inc. to its "Companies of Interest" watch list.

Cardiotech International, Inc. (CTE:AMEX) 9/7/05 $2.98 Medical device company, trading at 19.87 times forward earnings, 2.61 times sales, 2.81 times book, 6.28 current ratio, recently received FDA clearance for new product, $57.38 million market cap., $50.48 million enterprise value.

Source:Yahoo Finance & Business Investors Daily

WSR's Companies of Interest Earn 80% in 2004

In 2004, Wall Street Resources' proprietary "Companies of Interest" included 149 companies that, if purchased on the day of notification and held until year-end, lead to an average annualized return of 80%.  Here's a sample...

Name                                                        Annualized Return %
American Medical Alert (AMAC:NASDAQ)                        269.74%

For a FREE copy of WSR's complete list click here.


Wall Street Resources is a leading source for information on micro-to-small capital publicly traded companies.  These tools and publications include comprehensive analytical profiles, trading ideas, trading alerts, special reports, and exchange traded fund rankings.  To sign up for WSR's FREE investor services click here.

For More Information Contact:         
Gerald N. Kieft
Wall Street Resources, Inc.
9709 SW Pueblo Terrace
Palm City, FL 34990
(772) 597-3733 (tel) (772) 597-3735 (fax)
www.wallstreetresources.net
[email protected]

[fous]

Bought in today before the close at $2.90

Show me the money!

-fousc

[la-onda]

not the best start today 

what is your support line?

TIA
O.

[fous]

not the best start today

what is your support line?

TIA
O.

Im not too worried about todays action. This just looks like your everyday technical pull back from a sharp % gain. I have my support drawn at 2.66 which i think is gonna hold up. Though my stop loss is a close below $2.50 as of right now.

regards,
-fousc

[fous]

       Though CTE isn't lookin to hot at the moment. This is exactly as i stated it would do when i posted on the 9th. Today we had an 8.6% drop to close at $2.63. I have learned once more another lesson about discipline. I failed to trade my plan. Though thankfully i was able to make up for it. This lesson isn't about how to make up for the mistake(because how i made up for the mistake is only significant for myself). But more about to not make this mistake in the first place. As Ramsburg says, "Plan the trade, trade the plan". I clearly did my TA and made a game plan with a buy target hoping for the low 2.60's high 2.50's which i still believe to be an excellent price to get in. And i said i would be happy with anything between $2.50-$2.70. Though when i filled my position yesterday at $2.90. I failed to trade my plan, I watched intraday(just as it is my trading strat to not do so) and level II and got sucked into the market hysteria at a price $.20 higher than my plan entailed and had to suffer the 8% drop today.

       I failed to maintain discipline, the most important part of  being a successful trader. My point of this lesson is that before you make a trade, Do your TA, plan the trade, and just like Ramsburg says, trade the plan. Maybe by chance of luck you will get lucky by not following your plan. But just as David recently pointed on one of the 3SOF boards that a trader who benefits from an undisciplined trade, is only hurting himself in the long run. What would i do with out Dave and Fred  Basically my mentors.

      And for how i made up for my mistake. Currently i have 2 separate portfolios one is my etrade account with my actual equity that i began by mostly trading penny stocks only to lose  lots of money. Then i found 3SOF and have learned so much at this great site of information, and am following most of Davids picks to build my Equity. Then i have my marketwatch.com simulation portfolio which i would recommend to anyone that has had trouble trading the markets. And this portfolio has been doing awsome, too bad its fake This portfolio is all my personal picks such as this one. I'd have to say ive learned a lot about the market in the past 3 months. Enough to be starting to make money and not be one of the 95% of beginning traders who bust out of their equity. So i failed to trade my plan on my simulation portfolio and bought CTE at 2.90 wich isnt too bad of a price because i think this stock has great upside potential, but i could have done better by maintaining discipline and trading my plan. And today i did just that. Stayed away from being sucked into market hysteria and filled a postition in my real portfolio(my only personal pick in it right now, all others are daves picks)30 min before the close at $2.62. Just as my Plan B was intened to do:

-Considering plan B i would prefer to get in around the low 2.60's high 2.50's. Though i would settle with anything around between 2.50 and 2.70. The Next support after the gap would be at around 2.66. So this would probably be the time to start looking for and open posotion in light of plan B. Reasoning displayed on chart below.

Todays TA:
Price action broke through my support line at $2.66, hopefully we won't see this price drop much more below here and we have the beginning of a rally tomorrow. Next major support is roughly at $2.40. Due to my successful trade today at $2.62 the new support isn't much of a problem. Though my failed trade at $2.90 i would be considering selling around that area and would maybe sustain a loss. Right now were seeing decreasing price on lowered volume, a great entry point.

As well if anyone has any interpretation on candlestick charting if there is any reversal patterns forming we would all enjoy to hear about it, since i havn't dug into candlesticks yet. Soon though ;Dcurrently working on fundamentals.

Best of luck everyone- Sorry if this post bored anyone, But i think all traders at any experience  level can benefit from a reminder of this kind of mistake.

-fousc

[usedcasting]

Looks like still profit taking, but settling down.
Great post Fousc! Really appreciate your effort!

Great Community

u-

[Michael]

Hi Usedcasting and Fousc

I think the recent action has more to do with the CFO selling 6800 shares.

There has been no insider selling for a couple of years so the market didn't take it too well.

It is however a clear overreaction and a great buying opportunity. 6800 shares are only a very small fraction of all his shares and stock options and as he is the only insider selling it is probably some personal issue rather than an indication of the future performance of the stock.

Mike