You've got to love a company that makes money from something that it used to throw away. That's one way to get an immediate boost to margins.
Because of contract restrictions, we have no idea what Omrix Biopharmaceuticals'
The bonus product was just icing on the earnings cake. Revenue was up 72% year over year, led by Johnson & Johnson's
Management characterized sales of its other biosurgical product, Evithrom, as growing moderately well, but it's still signing up new customers for the product that was approved a year ago. Forty percent of customers this quarter were first-time buyers. Management thinks it's still trailing King Pharmaceuticals
The bottom line looked just as good, with Omrix apparently enjoying some economies of scale. Operating costs grew substantially more slowly than revenue. Even though the company now has to pay taxes, it still nearly doubled net income from a year ago, recording $0.17 per share in profit.
Omrix isn't the most popular of the Motley Fool Rule Breakers stocks, but grabbing stocks before Wall Street discovers them is often a prudent move. This is definitely one stock that shouldn't be discarded.
Find out why The Motley Fool picked Omrix for our high-growth Rule Breakers newsletter by grabbing a free 30-day trial subscription. You'll get access to all our back issues and the most recent picks.
Fool contributor Brian Orelli, Ph.D., has yet to find someone to buy his trash. He doesn't own shares of any company mentioned in this article. Johnson & Johnson is a selection of the Income Investor newsletter. The Fool's disclosure policy has reams of computer paper saved up for the eventual comeback of the dot-matrix printer.