Best Digital Medical Record Small-Cap Stock
Small-cap technology stocks have been on a nice run lately, buoyed by prospects of an improving business climate and the efficiency gains from technology. Pull up a chart of tech bell-weather Cisco Systems (NASDAQ: CSCO) and you'll see what I mean. The company's stock has risen 8% since the beginning of February, and is just 3% shy of its 52-week high of $25.10.
The small-cap technology stocks in the Small Cap Investor PRO portfolio have also been rallying. And I'm getting ready to add another technology stock to our portfolio that is well positioned for profits in 2010. You can sign up for a risk-free 30-day trial to Small Cap Investor PRO today and be among the first to receive the report on this high-potential small-cap technology stock. Just click here today!
** I received an interesting request to review a small-cap health care stock the other day. Chad writes:
"The Obama camp is going with all electronic medical records. General Electric (NYSE: GE) is currently running commercials about their technology in this field. What do you think about the Florida Company Medefile International (OTC BB: MDFI). Any chance it will hit the almighty dollar?"
Thanks for the lead Chad. I spent yesterday afternoon taking a look at Medefile International. I found that the company is a tiny penny stock with a market cap of just $9.3 million, and that shares trade at $0.0082. That's right – less than a penny a share! The stock trades in the over-the-counter bulletin board (OTC BB) market. OTC traded stocks can represent huge profit opportunities. This is especially true if you invest in those likely to gain listing on a major exchange. We use this strategy in the Small Cap Investor PRO portfolio and have already had one OTC listed junior gold minor gain AMEX listing. You can find out more about this stock by clicking here.
But let's get back to Medefile. This is a very speculative potential investment since the tiny company has very little actual cash flow. In 2008 revenues totaled just $53,000, and in the most recent quarter ended September 30, 2009 the company brought in just $5,155. I tend to be more of an investor then a speculator, so I typically will look for companies doing more business than this.
According to the company website, Medefile was "…formed in 1998 with the goal of empowering individuals to take control of their healthcare. MedeFile members have the ability to create, access, and share their entire personal health history and ACTUAL medical records from one place - anytime, anywhere."
Essentially, the company provides a secure storage solution for personal medical records. As Chad noted, this is an industry that is receiving a ton of support from the Obama Campaign. President Obama said he wants all medical records to be digitized by 2014. The push has created huge opportunities for digital medical record companies like General Electric.
But as you would expect, I prefer the approach of investing in the smaller players since they represent the greatest profit potential. It's hard for even a big market opportunity to move the needle on General Electric's stock given its $15.9 billion market cap, and the fact that digital medical records are just a very small portion of the company's overall business.
I really like the industry, but Medefile is simply too small for me. The company is in a great market that is likely to grow in the next couple of years, so it's worth keeping an eye on it. But for me the risks are too high at the moment to make an investment.
*** But even though I'm not a buyer of Medefile right now, I am recommending another digital medical record stock. I have this company in the Small Cap Investor PRO portfolio and it has been a favorite of my subscribers. This little gem provides medical transcription services to the U.S. healthcare industry. Its proprietary technology converts physician voice recordings to a digital record. The stock has been a steady performer, and in 2009 revenue increased by 47% to $71.8 million. The company is turning a nice profit too. In 2009 it earned $0.75 a share, a 15% increase over $0.65 per share in 2008.
The future prospects for this company are bright indeed. In fact, it's growing by leaps and bounds as it acquires smaller companies. In 2009 it acquired three, which collectively contributed 27% to 2009 revenue. I wouldn't be surprised if this company was in the cross-hairs of a larger company like General Electric! You can learn more about this digital medical record small-cap stock when sign up for a no-risk trial to Small Cap Investor PRO. Just click here today!
