Ultrasound manufacturer Sonosite $SONO is a stock that has been in the doldrums recently, but a disciplined investor will take the opportunity to buy more provided he continues to believe in the earnings prospects. I do, and I think I am, so I bought some more! Sonosite was featured at length in an article linked here and I think it has good earnings potential as well as being a potential bid target.
Furthermore, an interesting report was recently released which adds strength to the potential for this stock to go higher. In a report produced by Harvey Klein of Klein Biomedical Consultants, the compact ultrasound market is predicted to grow at 13% per annum over the next five years. In the US the market is forecast to expand from $276m in 2010 to $505m in 2015. Outside of the US, the market is expected to grow at 10%
In addition, the report cites Sonosite's 2010 US market share as being 42% and an investor only has to look at the next two players (GE & Philips) to find potential acquirers of Sonosite. If the market plays out as expected, Sonosite's US sales (provided they keep market share) could rise to at least $212m by 2015.
Given the recent analyst upgrades, now looks like a good time to pick some up. I bought some more.
PR Web, 'Leading Industry Analyst Reports Record Highs In U.S. Compact Ultrasound Revenues For 2010'