A quick note for those of you who have not been following this company closely, and might not have noticed that Georges Yared is touting the same stock for GameChangers that Marc Lichtenfeld has been touting for his Access Group.
Georges has ramped up his advertising this year, first pushing Visa and then pushing several different ideas as the “next Visa” — he’s a showman, at least, and he does claim a record of many very big winners over the years. With a strategy like his I would assume he has a good number of losers, too, not unlike Tobin Smith’s ChangeWave — when you go for massive growth in smallish companies, it’s bound to blow up more often than note, and you have to expect that you’ll find enough 1,000% winners to make up for the losers.
Not that there’s anything wrong with that — it’s not too different from many folks who speculate in stocks, most of us are aiming for a few massive winners — very few people sit down to sift through stock ideas and pick those that they hope can produce a 10% annual return. Ah, but a man’s reach should exceed his grasp, or what’s a heaven for? (First one to identify the source of that quote in a comment below gets a free one year membership in the Irregulars).
So Georges is widely touting this stock as another one of his “next Visa” stocks, though of course it has nothing to do with transactions or financial services at all. Here’s an excerpt of his ad:
“Today, 5 million guesswork biopsies are conducted each year in America, at a cost of $1,800 a time. I estimate that our company only needs to achieve 1.2 million procedures at $175 a time, with $75 of that going straight to the company. That highly conservative number puts us in the $100 million revenue ballpark, at which point we’re beating Ely Lilly and Johnson & Johnson off with sticks. Meanwhile, of course, we’ve got 75 million baby boomers riding off to their sun-drenched rewards, starting this summer.
“You get the picture; a market growing so fast, it’s insane.
“The NEXT Visa?
“Nah—It’s MUCH BETTER THAN THAT!
“THIS is the one you plan your retirement around, not just your daughter’s wedding!”
So, the Access Group has been pushing this one since $4.50 (a couple months ago), Yared is touting it here at $8.50. Where’s it going?
Beats me, I’ve been a bit too skeptical about this one all along, to my financial detriment.
The stock is — this won’t surprise any regular readers — Electro-Optical Sciences (MELA), makers of a little device that they use to scan spots on your skin and assess whether or not they’re dangerous or cancerous.
Lots of fans of this one, and a very sharp move up. I’ve said most of what I can about it in previous posts, here and here — those posts also have some useful comments that you might check out if the stock intrigues you.
Yared adds that he likes the “razor and blade” model (which Warren Buffett also always talks about as his motivation for an original investment in Gillette so long ago), since this firm will sell the little scanner machines as well as get a service fee for the use of their image database that the machine uses to compare a mole to a vast universe of malignant tumors and benign moles.
It’s a great model, if overused as a metaphor by financial analysts and stock touts – for example, the “razor and blade” model is often cited as a reason for the future success (and lofty valuation) of Intuitive Surgical, maker of the million-dollar da Vinci surgical robots … but that doesn’t mean it will work every time it’s tried — I imagine the key will be whether dermatologists embrace it and it gets accepted as a standard tool, knowledge that is beyond my understanding.
I can’t imagine those of you out there in Gumshoeland have even more to say about this one, since I think this is the third time I’ve written about it this year … but you never know, feel free to surprise me!
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