SMLR - Semler Scientific Offers Great Potential But Don't Overlook The Risks

2024-02-13 19:55:27 ET

Summary

• Semler is a medtech company with high ROC, double-digit top-line growth, and a robust balance sheet.
• The company operates in the cardiovascular testing industry, primarily marketing the QuantaFlo blood flow assessment tool.
• Semler faces risks such as patent expiration, customer dependency, and product dependency, but the stock is still a buy due to its low price.
• The management has a lot of skin in the game, plus an activist investor.
• In an optimistic scenario, the stock is dirt cheap.

Opener

Well, I don't usually delve into biotech/medtech, especially if the company isn't diversified among various products. In my view, there are a lot of risks that I don't have the expertise to anticipate. However, as an investor who appreciates quality and profits, I couldn't ignore Semler ( SMLR ). It has a few great traits every investor should appreciate: high ROC above the cost of capital, double-digit top-line growth, a robust balance sheet, and good management with a ton of skin in the game. Despite doubling in price over the last six months, I still think Semler presents an opportunity. It may even be cheap; six months ago, it was probably dirt cheap....

For further details see: