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Cytomedix (OTC: CMXI), An Initiation Research Note With A “BUY” Ranking

Cytomedix is another hybrid - 2/3rds device and 1/3rd therapeutic … who develops, sells, and licenses regenerative biological therapies to primarily address the areas of wound care, infection control, and orthopedic surgery in the US.

Cytomedix (OTC: CMXI) … I am initiating in a brief "Research Note" daily mention and inclusion in our RegMed Competitive and Market Intelligence daily letter. CMXI opened trading on 12/5/12 at $0.74 with a market cap of $67.89 M and enterprise value of $73.36 M from Tuesday's closing range of $0.74 to $0.81 and 42.2 K share volume. I initiate with a "BUY" on the basis … CMXI is undervalued. My price target is $1.25!

The Bottom Line: I have commented a number of times that I have believed CMXI was undervalued and most recently stated it was worth $1.25 … at a minimum. CMXI had 9 month revenues to the tune of $8.46 M and the most recent CE Mark for the Angel cPRP system boosted the share price by $0.18 but has dropped off -$0.06 or -7.50% to $0.74 in this depreciating market.

In August CMS agreed to cover AutoloGel system for wound healing in 3 major wound types with the national coverage decision or NCD, for coverage with evidence development. During Q3/12, CMXI achieved important milestones in reimbursement and regulatory areas which should have commercial implications for 2 lead products. The 52 week range is $0.57 to $2.32 with 91.75 M shares outstanding and a float of 64.43 M.

One of my major interests is the highest <I have seen> % held by insiders … of 40.78% and their personal stake stands out! However, the cash position is generated internally and stands at $5.83 M <as of end of Q3/12>. The Q3/12 net loss was $3.78 M or $0.04 per share compared to a net loss of $2.29 M or $0.04 per share in the prior year.

The month of November, the stock trading range was $0.75 to $0.88 while in October the range was $0.75 to $0.90. In September, before most of the market conflagration the shares traded $0.83 to $1.13. For most of these 3 months there was little news to broaden the share pricing disparity.

Cytomedix is another hybrid - 2/3rds device and 1/3rd therapeutic who develops, sells, and licenses regenerative biological therapies to primarily address the areas of wound care, infection control, and orthopedic surgery in the US. Cytomedix is an autologous regenerative therapies company commercializing innovative platelet technologies for orthopedics and wound care with a pipeline of adult stem cell therapies for tissue repair. CMXI markets the AutoloGel™ System, a device for the production of autologous platelet rich plasma ("PRP") gel for use on a variety of exuding wounds and the Angel® Concentrated Platelet Rich Plasma System, a blood processing device and disposable products used for the separation of whole blood into red cells, platelet poor plasma ("PPP") and PRP in surgical settings On 2/8/12, CMXI closed the acquisition of Aldagen, a biopharmaceutical company developing regenerative cell therapies based on its proprietary ALDH bright cell technology, currently in a P2 trial for the treatment of ischemic stroke. CMXI was formerly known as Autologous Wound Therapy in 1987 and changed its name to Cytomedix in 2000 and is headquartered in Gaithersburg, Maryland.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.