For you fellow long-term followers of ICU Medical (NASDAQ:ICUI), you knew this day would come. You wouldn't think that the business of making IV connection systems and custom IV sets would be that volatile a business, but click on a long-term chart and you see quite a bit of stock instablity.

It would seem that the culprit this time was guidance, but we'll get to that in a moment. Sales for the fourth quarter were actually quite robust -- up 185% as reported, and still very strong, even if you subtract the business from the acquired Salt Lake City facility. I suppose that if you really want to nitpick you can observe that sales were down sequentially, but because ICU Medical relies upon distributors (namely Hospira (NYSE:HSP)), I don't think sequential figures are terribly informative.

Profitability was also good for the quarter. Gross margins improved over last year (and improved sequentially), and management reported that it's brought the Salt Lake margins up to 27% -- from 15% just two quarters ago. Year-over-year comparisons for operating income and net income aren't all that helpful, since the company posted losses last year.

On the guidance front, though, the company offered a target that was just a bit below the average estimate (5% on revenue, about 2% on EPS), but apparently that was enough to spook investors. Still, I suppose that's par for the course on a historically volatile, heavily shorted medical technology stock.

Even though Becton Dickinson (NYSE:BDX) and Baxter (NYSE:BAX) are not to be underestimated as competitors, I still think ICU Medical can continue to grow. It's built a defensible niche for itself with quality products. And the ongoing combination of margin improvements at the Salt Lake facility and new product introductions (like a new diabetes infusion set that's due soon) should be good news for earnings and cash flow.

That said, I'd have to be offered a discount to buy shares of a stock as temperamental as ICU Medical. And even with today's steep drop in price, I wouldn't say the shares are cheap enough to be interesting.

For more medical missives with a Foolish flair:

Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).