Investors are eating up health-care and security technology expert Analogic's (NASDAQ:ALOG) earnings and share repurchase announcements that came out this morning.

First, let's tackle the earnings, which were bolstered by a monster one-time gain from the sale of the company's stake in Cedara, which was recently acquired by Merge Technologies (NASDAQ:MRGE). The one-time gain of $43.8 million allowed the company to report a profit of $2.07 per share for the quarter vs. last year's $0.08 per share. Without the gain, the company would have booked a slight loss because of heavy investments in research and development, which are expensed.

The $25 million share repurchase program, if executed at today's prices, would retire about 4% of Analogic's outstanding shares. However, the $25 million only represents a little over 10% of the company's cash hoard.

The large cash hoard and lack of debt is what recently caused me to stop and take a look at Analogic. The cash hoard gives the company an enterprise value of about $400 million (before the stock repurchase) vs. its market cap of $630 million. Generally, a situation like this points to potentially hidden value.

In Analogic's case it may as well. But you'll need to do some legwork and digging to get there. Over the past couple of years, Analogic's free cash flow and earnings have declined each year because of the previously mentioned increase in research and development expenses, and in the last year because of a large decline in the sales of the company's EXACT systems and parts to L-3 Communications (NYSE:LLL).

If the company can find its way back to its average level of free cash flow for the previous three years, the shares today would be priced at an attractive enterprise value-to-free cash flow ratio of just above 12. To get there, the company would need to begin reaping gains from its technology that is in development. There are some signs of this happening because revenue appears to be on the upswing and the company is seeing interest in some of its new products.

For investors, it will also require a heavy dose of patience. The two industries that the company operates in are regulated by the Food and Drug Administration or the Transportation Security Administration, and in turn, newly developed technologies can take a few years to bear fruit. For those with the patience, Analogic is definitely worth a look.

To check out more on Analogic, see Time for Deep Value Again.

Nathan Parmelee has no financial interest in any of the companies mentioned.