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The author of Stockerblog worked for over 20 years in the financial industry as a stockbroker, investment advisor, Vice President of a San Francisco money management firm, mutual fund wholesaler, and market maker on the Pacific Stock Exchange. He has written articles for the Bond and Share... More
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  • Cosmetic Surgery Stocks: A Growth Industry Like 3D Printing? 0 comments
    Feb 1, 2013 3:14 PM | about stocks: ALGN, CYNO, PHMD, SLTM

    American are getting older but looking younger. According to recent data at the United States Census, persons over 55 years old now make up 25% of the population. According to an article published by Stony Brook University School of Medicine, 3.3 million Americans over the age of 55 underwent cosmetic procedures in 2010, and facelifts are up 14% just for men. The article emphasizes the fact that older Americans are turning to cosmetic surgery to compete in the job marketplace.

    Innovative procedures in cosmetic surgery, and especially liposuction, have made huge advances recently. The procedure is now much quicker, safer, and with a much faster recovery period. Casey Research has published an outstanding report on the history of cosmetic surgery and the latest technology in the field.

    Will this industry be the next hot industry? Will the stocks in this field rise by 200% in a year like the 3D printing stocks? It is hard to know when revenues will start to skyrocket and investors will jump on the stocks in a narrow niche. There are about a half a dozen cosmetic surgery product companies in this business according to WallStreetNewsNetwork.com, and surprisingly, many of these companies are debt free with a lot of cash on a per share basis.

    One of the leaders in the field is Cynosure (NASDAQ:CYNO), which produces Smartlipo® LaserBodySculpting™ Workstations used for treating localized fat deposits using a minimally invasive technique, and makes three laser options that take different approaches to treat cellulite: Cellulaze, SmoothShapes XV, and Triactive. The company just released PicoSure, the first picosecond device to remove tattoos. The stock trades at 43 times trailing earnings and 30 times forward earnings. The company has $807,000 in debt, with $5.97 in cash per share. Revenues for the latest reported quarter ending September 30 were up 31.1%. The company reports year-end earnings on February 12 before the market opens.

    Solta Medical (NASDAQ:SLTM) produces the Thermage CPT non-invasive treatment for skin tightening, and the Liposonix system to destroy unwanted fat cells resulting in waist circumference reduction. The stock trades at 29 times forward earnings, has $27.8 million in debt, and $0.56 in cash per share, amounting to about 22% of the stock price. Revenue for the latest quarter rose by 27.8%. The company reports on February 19.

    There are other companies that participate on a peripheral basis of the look-good, look-younger industry. For example, Align Technology (NASDAQ:ALGN) makes the Invisilign systems, an invisible orthodontics process for straightening teeth. The stock has a trailing price to earnings ratio of 35 and a forward PE of 24. The company has no debt with $4.03 in cash per share.

    PhotoMedex (NASDAQ:PHMD) makes XTRAC laser products for psoriasis and vitiligo, NEOVA for premature skin aging, and Omnilux Light-emitting diode for wrinkles and acne. The stock has a PE of 19 and a forward PE of 10. It has $17,000 in debt, with $2.55 in cash per share.

    To access a free list of the cosmetic surgery stocks, and stocks in related industries, go to WallStreetNewsNetwork.com.The list includes the trailing PE, the forward PE, the total debt, the cash per share and the business.

    Disclosure: Author did not own any of the above at the time the article was written.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Stocks: ALGN, CYNO, PHMD, SLTM
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