Buy Shares of Imaging3 in Anticipation of Future FDA Approval

I'm not selling Imaging3 (IMGG.OB) so quickly this time.

I bought into IMGG again on Friday at approximately 1.44/share. As posted on this site, I have bought in and sold a few times this year (and originally researched / bought the company several years ago when it was truly a penny stock). When I first bought into it, I felt nervous because I usually do not buy penny stocks due to their vulnerability to manipulation etc. If you review my instablog, though, you can see that I actually visited the company unannounced and did my due diligence.

I had sold IMGG at around .96, thinking it would remain around there for a few weeks. Instead, it shot up to 1.22, by looking at the volume (which at over 3M is WAY higher than usually used to be), I highly doubt this stock will retest $1 anytime soon. Basically, the cat is out of the bag, and people are beginning to recognize that the Dominion is likely to change the imaging device market for the near future.

I guess it took so long to get here that now I cannot believe how quickly things are happening. I wish I had kept all my stock longer. However, I have reinvested most (or perhaps more) of my profits into this stock. Foolish? Maybe, but maybe I was too slow to realize that IMGG's product is finally getting the recognition it deserves.

Imagine if you are in hospital and need an x-ray: do you want the x-ray with a higher level of radiation or a lower level? While sometimes the higher level might be needed, generally the Dominion's lower level will make it worth asking your doctor for it, if your doctor or hospital, for legal reasons, does not already insist that you start with a low dose of radiation. I mean why use an older x-ray machine that doesn't use real time AND increases your chances of cancer?

Anyway, when I did the numbers on 11/12/09, Yahoo said there were 263.36M shares outstanding. Per the CEO's comments, this a $16B dollar industry that he believes his company can capture at least 5% of (i.e. 800M) in 2 years and even 10% in 4 years (per investorshub.com comments). This is what leads people such as myself and Thisisit to believe there is still value in this stock. Unfortunately for me, everyone else is seeing the value too, and thus the price has rocketed up. I don't have enough expertise to measure the target price more than to say that $3 - $5 sounds fair and might even be conservative.

If I had time to day-trade this I might, but for those of you who are looking for buying opportunities, these are the following pivotal events:

• RSNA (a radiology show full of doctors / investors) is coming up: In the past IMGG has gotten a boost from this event, and then the price has fallen...since FDA approval could happen anytime, I don't think the price will be likely to fall much, but if so, it's a buying opportunity.
• FDA approval: Certainly some investors will be so overjoyed they will sell and the price will jump perhaps as high as $5 and then go lower, perhaps even below $3. Again, this volatility could present a buying opportunity.
• Production Deal / Sales of the Dominion: This company has the ability and warehouse space to manufacture the unit itself. Personally I wish the company would do so, because that would generate a long term cash flow and perhaps even dividends, etc.
• License Agreement or Buy Out: It's my understanding that IMGG has already turned down some small pre-FDA approval offers. If the CEO thought this was not going to be approved, he could have sold or even declared bankruptcy etc. by now. Since there are many uses for this technology (e.g. - airport screening device, or military hospital use) AND software updates might provide additional revenue, in my opinion it seems entirely possible that a buyout offer of $5-$7/share could occur. Even if the FDA approves the deal (which seems likely), and a buyout brings "only" $3-$5/share instead of $5-7/share, that's twice the current price of this stock so this time I'm holding and willing to wait for FDA approval even if it takes another year or so.

Disclosure: Long IMGG.OB.

Comments

[jimocarroll:]

Will imaging be a $16B industry if the government is controlling health care?

Nov 15 09:16 AM

[dual cit:]

Are you nuts ? They did a private placement on Oct 8th of 107,059,027 shares of its common stock at a purchase price of $0.025 per share

Nov 15 10:35 AM

[bonddude:]

Were you aware the stock price was $ .04 when they did that deal? All of a sudden there was aggressive buying right afterwards. Perhaps by the same entity that bought at 2.5 cents.
After all, they got a good look under the hood, right?


On Nov 15 10:35 AM dual cit wrote:

> Are you nuts ? They did a private placement on Oct 8th of 107,059,027
> shares of its common stock at a purchase price of $0.025 per share

Nov 15 03:17 PM

[larry luv:]

There was a recent Private Placement finalized for over 100mil shares.Your O/S Comment of 260,000 is disingenuius.
total-It is around 400 million+ O/S now.
The CEO Dean Janes has said the only remaining questions the FDA had was the labeling/intended use issue.
Now the fact that the FDA is still inquiring to IMGG about how they labeled their intended uses for the Dominion obviously means there are some issues that the FDA was not agreeable in approving this Device under IMGG's prior submission of labeling/intended use.
Dean Janes is now saying that issue is resolved but its not up to him,its up to the FDA to approve this recent resubmission by IMGG.
This FDA approval is NOT a slam dunk yet' as many would have you believe.
There has been hundreds of CEO's that have been confident that their drug or device would be approved,only to have the FDA give them a Black Eye...
The Dominion may get approval,but this overconfidence is a negative..

Nov 15 11:19 PM

[larry luv:]

MY Typo -You said 263 million O/S. That is incorrect.
400 MILLION is more like it

Nov 15 11:22 PM

[M. E. Garza:]

Did you guys read this:

The Company has incurred significant losses from operations, and such losses are expected to continue. The Company's auditors have included a "Going Concern Qualification" in their report for the year ended December 31, 2008. In addition, the Company has limited working capital. The foregoing raises substantial doubt about the Company's ability to continue as a going concern. Management's plans include seeking additional capital and/or debt financing. There is no guarantee that additional capital and/or debt financing will be available when and to the extent required, or that if available, it will be on terms acceptable to the Company. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. The "Going Concern Qualification" might make it substantially more difficult to raise capital.

investorshub.advfn.com...

I would encourage all IMGG investors to look closely at VKNG-- which is also in the imaging business, but already has FDA approval AND had 9 Million in revenue -vs- IMGG

Nov 16 06:45 AM

[Ubor:]

Mr. Garza,

You are clearly biased. First you own VKNG and have not declared that position here. Why are you going on an IMGG board to promote a stock you own, your own $$$ reasons.

You are not a news organization if you were you'd also include the statement VKNG made in their 10Q filed 11.06.09

"Management believes that the Company’s existing cash resources, combined with projected cash flows from operations may not be sufficient to execute its business plan and continue operations for the next twelve months."

Sophisticated investors are aware of these standard statements but, perhaps not that you make a living pumping companies you own stock in. Now you lower yourself, in an attempt to get stockholders to switch to a company you own with similar disqualifying statements.

Nov 16 08:58 AM

[User 500718:]

thanks for keeping the price down while I buy more....

Nov 16 03:59 PM

[bonddude:]

Uh, your joking right? All one has to do is look at your comment record and yep, it's official, you do know what garbage looks like as you tout some dog CHI-Com bubble stock that has dragged ass for years with barely any reliable info available (CHID.OB).
You have got to be about 12 years old, huh?

Look sonny, you play with the bull sometimes you get the horns, which you are about to. One filing doesn't always tell the whole story. Read it and run along to your make believe world Mr. Soros.

investorshub.advfn.com...


On Nov 15 10:48 PM Legacy Investments & Development, LP wrote:

> I can't believe that Seeking Alpha allowed for a post to be made
> public on a P.O.S. like this company. What a share.
>
> Fundamentals, what fundamentals? Maybe you're comfortable betting
> on deals with roughly $1.5MM in TTM revenue and no major funding
> partner, like GE for example - a company that regularly funds technology
> partners and innovators, but there's no way any of the remarks made
> justify a $330MM market cap.
>
> Finally, to the uninformed that is bonddude, you likely need to stick
> to Bonds, not Equities. You incorrectly state "the stock price was
> $ .04 when they did that deal," in reference to the IMGG 107,059,027
> two and a half ($0.025) placement.
>
> - In fact, as the 8K stated, the money closed on Oct 8, 2009, a
> day on which IMGG traded between $0.54 - $0.61.
> - Further fact, revealed in the company's Q3 filing (that's September
> end 2009 bonddude), the company had NO MONEY BOOKED FROM THE OFFERING
> which means, of course, the from Oct 1 through Oct 8 the entire $0.025
> PPM was placed - AT A MERE 95%+ DISCOUNT TO MARKET.
>
> What a shame this pure pump has now made it's way to SA.

Nov 16 04:52 PM

[Don-n-ABQ:]

If you listen to anybody who uses Yahoo! Finance (or Google Finance, AOL Finance, etc., etc.,) to get data from, well, they are either trying to spin something or their due-diligence is not worth listening too.

I can look at almost any stock on these services, especially small and mid-caps, and find an error within about 10 minutes or less. Many of them get their data dump from the same vendors, like Reuters, so if the data service provider (DSP) enters the wrong number (hasn't updated) it is wrong on many of these services.

This statement says it all:

"I usually do not buy penny stocks due to their vulnerability to manipulation etc."

Sounds like somebody is trying to sell their position doesn't it?

If you people are willing to buy on this, have I got a deal for you...

Nov 16 05:59 PM

[fishluvrain:]

As with all investments the reality is the share price. As in the case of all Biomed/Med Device stocks, They Bleed Money. Usually when they bleed badly the stock price reflects this by going down. Watching this share price advance is a very intriguing sign. The world could use this device. I hope it is approved.

Nov 17 12:41 AM

[b3rkut:]

so other where do u get your analysis info from?


On Nov 16 05:59 PM Don-n-ABQ wrote:

> If you listen to anybody who uses Yahoo! Finance (or Google Finance,
> AOL Finance, etc., etc.,) to get data from, well, they are either
> trying to spin something or their due-diligence is not worth listening
> too.
>
> I can look at almost any stock on these services, especially small
> and mid-caps, and find an error within about 10 minutes or less.
> Many of them get their data dump from the same vendors, like Reuters,
> so if the data service provider (DSP) enters the wrong number (hasn't
> updated) it is wrong on many of these services.
>
> This statement says it all:
>
> "I usually do not buy penny stocks due to their vulnerability to
> manipulation etc."
>
> Sounds like somebody is trying to sell their position doesn't it?
>
>
> If you people are willing to buy on this, have I got a deal for you...

Nov 17 03:24 PM

[b3rkut:]

"FDA approval: Certainly some investors will be so overjoyed they will SELL"???

whats the logic in that statement???

Nov 17 03:31 PM

[Don-n-ABQ:]

1) Regulatory sites:
A) Edgar in the U.S.
edgar.sec.gov/edgar/se...
B) Sedar in Canada
www.sedar.com/search/s...
C) ASIC in Australia
www.search.asic.gov.au...
D) UKLA (FSA) in the U.K.
www.fsa.gov.uk/ukla/of...
E) other:
International Organization of Securities Commissions
www.iosco.org/lists/

2) Company websites and conference calls

3) Industry specific websites and publications

4) Equity conferences

5) Compare thesis with top analysts


On Nov 17 03:24 PM b3rkut wrote:

> so other where do u get your analysis info from?

Nov 18 03:59 AM

[8-UP:]

I AM 49 YEARS OLD AND NEVER REALLY BOUGHT STOCK, BUT A FEW THINGS I DO KNOW, I BOUGHT AT .05 IN 2004. AND I KNOW WHAT DRIVES STOCK PRICES UP, WHEN THERE ARE MORE BUYERS THAN SELLERS,SO THE PEOPLE DUMPING THERE SHARES WILL BE DON SOON, THEN THE STOCK WILL GO BACK UP, I BELIEVE 3$-10$
IS MORE REALISTIC THAN SOME OF THE CRAP I HAVE HEARD.THE MEDICAL SHOW IS THE END OF THIS MONTH(RSNA) AND WITH FDA APROVAL IN THE FINAL STAGES THE WAT IT IS, I BELIEVE DUMPING MY SHARES RIGHT NOW WOULD JUST BE FOOLISH, I AM NOTSTUPID I KNOW "ANY" STOCK CAN TANK.
THE WORST THING THAT HAPPENS, I GET MY MONEY BACK BUT I THINK THE REWARDS WIL BE MUCH HIGHER....

Nov 18 09:47 AM

[Admiral Geo...:]

IMGG is nothing but a pump job. Why else would they sell shares at 96% below the market price to raise money- no one else will buy at anywhere near the market price!! Read this for a real analysis: seekingalpha.com/user/... .

Nov 19 09:43 AM