|
Published: June 14, 2010
This company not only offers you a chance
to snag a hefty return, it also does some good.
Just one of this company's several cutting-edge technologies
offers 150,000 people a year a fighting chance against a deadly
disease. That disease is colon cancer, which kills 50,000
Americans every year and is the No. 2 leading cause of
cancer-related death.
Fact: One in 19 people will be diagnosed with colon cancer at
some point in their lifetimes. Risk rises with age, and everyone
over the age of 50 should be screened. The most common test is a
colonoscopy, which rates among the least pleasant mainstream
medical procedures.
Sometimes we joke about these invasive exams, but they're no
laughing matter. Colon cancer kills a very high percentage of
the people it affects, and early detection is key. But the
critical clinical advantage of early detection is forfeited if
people aren't screened, and studies show only about half the
people who need to be screened really are.
An emerging technology has been proven to solve this problem,
and that is the virtual colonoscopy. It's a noninvasive test
that uses a CT scan from outside the body instead of a scope
inside the body.
The most important question, of course, is
whether this test is accurate. And the answer will surprise you.
Not only is the virtual colonoscopy extremely accurate and
effective at detecting colon cancer -- 90% -- it turns out that
the traditional optical colonoscopy isn't as failsafe as
previously thought. There are a number of places inside the
colon where potentially deadly polyps can lurk and where the
optical scope has difficulty visualizing them. But there's no
hiding from a CT scanner.
That scanner only creates an image, though. It merely collects
data. Where this company comes in is not in the design or
manufacture of CT scanners or MRI machines but in the highly
complex software that exploits and maximizes their
effectiveness. Looking for cancer is a game of hide-and-go-seek,
with the cancer hiding and the radiologist looking. The software
eliminates the seeking and fast tracks the finding. It can
manipulate the data collected by the scanner in dozens of
diagnostically relevant permutations. And it significantly
lessens the potential for human error.
The name of this company is iCAD (Nasdaq: ICAD). And it
has several catalysts behind it that make its shares a very
compelling investment that offers strong potential returns:
're unfamiliar with how geothermal energy
is produced, here's a quick-and-simple overview of how the
process works:
- iCAD has submitted an application for FDA approval
of its virtual colonoscopy. The regulators have said they
need no additional information, which suggests approval is
imminent. That approval opens up the virtual colonoscopy
market.
- iCAD is a small company that's developing technology, but
it's not burning through shareholder's cash. It has plenty of
cash on hand to help roll out its virtual colonoscopy platform,
and the company also has no debt.
- iCAD has achieved this position of financial strength by
establishing itself as a leader in diagnostics. The virtual
colonoscopy is not the only dance on its card. It excels in
several diagnostic areas, including mammography. How good is
this technology? Consider a recent announcement: iCAD was
selected to provide its mammography technology to 400 federal
healthcare facilities, including the Veterans Administration
network of hospitals. In other words, when the Department of
Defense needed to procure a weapon against breast cancer, it
chose iCAD. It's hard to think of a stronger endorsement.
With a pending approval that will open up a new market, a
strong balance sheet and existing industry-leading
technology, iCAD is poised to deliver outstanding results not
only to patients but to investors.
iCAD trades around $1.75. The shares have a 52-week high of
$2.43, but even recapturing that ground undervalues the company
on the federal contract alone. The pending approval of its
virtual colonoscopy should take the company far beyond that.
Long-term investors interested in capturing the remarkable
returns possible from exploiting a leading technology should dig
in for the long-term and a double-digit price target.
More active traders should consider an immediate purchase at
under $1.75 with a price target of $2.25 and a stop at $1.50. I
anticipate this +28.6% gain in the near term to stem from
approval of iCAD's virtual colonoscopy product.
-- Andy Obermueller
Chief Investment Strategist
Government-Driven Investing |
