Why AtriCure, Inc. Shares Surged

AtriCure updates its preliminary fourth-quarter and 2014 full-year guidance, but this is really what shareholders should be watching.

Jan 10, 2014 at 3:54PM

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of AtriCure (NASDAQ:ATRC), a developer of cardiac surgical ablation systems, vaulted higher by as much as 21% after announcing preliminary results for the fourth quarter of 2013 and issuing its 2014 full-year guidance.

So what: For the fourth quarter, AtriCure expects to report $21.9 million in revenue, a 19% increase over the previous year with domestic revenue growing by 20% and international revenue increasing 17%. For 2014, management is projecting full-year revenue of $100 million to $103 million, representing a 22%-26% increase over 2013 with organic growth of 13%-15%. ArtiCure also anticipates its recently closed Estech transaction will be dilutive to EPS in 2014 and accretive to EPS in 2015 and beyond. By comparison, Wall Street had expected just $20.1 million in revenue during the fourth quarter and $90.1 million in sales in 2014.

Now what: What we have here is a mixed bag. On the one hand, ArtiCure's organic growth and growth by acquisitions could fuel sales growth of 10% for at least the next couple of years. In addition, an aging baby boomer population is widely anticipated to a boon to the health-care industry and medical device companies like ArtiCure. On the other hand, ArtiCure's share price has already soared threefold over the past year and it still doesn't have any profits to show for it. While its top line is headed in the right direction, I have a hard time suggesting anyone chase this higher without any tangible profits. Until I see a very meaningful reduction in losses, I would suggest watching this company from the sidelines.

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4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

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The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

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Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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