Hansen Medical, Inc. (HNSN)

Firesale (< 20) Submitted: 10/04/07 3:06 PM : Start Price: $25.73 HNSN Score: -27.03

In the Mold of Intuitive Surgical

Hansen Medical (HNSN) engages in the development and manufacture of non-invasive medical robotics for positioning, manipulation, and stable control of catheters and catheter-based technologies. Its lead product Sensei is designed to allow physicians to navigate flexible catheters with stability and control in interventional procedures via robotic controls that move the catheter within the patient anatomy. The Artisan control catheter and sheath assembly consists of a telescoping set of control catheters that are integrated to provide the desired motion of the tip of a diagnostic or therapeutic catheter that comprise a needle and dilator assembly designed to puncture and expand the atrial septum of the heart. This computer-aided process is in the mold of Intuitive Surgical (ISRG), which has revolutionized surgery. Hansen Medical aims to do the same within its own niche.

What does this all mean. First, pre-operative mapping of the electrical activity of the heart that can be done in substantially less time than using conventional methods. Second, a patient is exposed to less radiation. Third, expansion of the types and complexities of procedures the catheter lab can perform. Fourth, revenue from unit sales and recurring service and parts. The market for cardiovascular medical devices exceeds $120 billion, and according to company sources, is growing at 12% annually. Last, the founder of Intuitive Surgical is tied to this company. This translates into expansive growth.

Hansen Medical growth will come from its recent FDA approval in the United States, European Union this May for two its robotic systems Sensei and Artisan. There is little public data on exact earnings, but what can be gleaned comes from Ford's, HSNS "Earnings momentum exhibits an upward curvature that indicates that earnings have increased from $-15.69 to an estimated $-1.96 over the past 5 quarters, they have shown strong acceleration in quarterly growth rates when adjusted for the volatility of earnings. This indicates a good improvement in future earnings growth may occur." Needham states, "We are convinced that robotic navigation surgery will become standard of care for the treatment of complex arrhythmias and other cardiac diseases."

Hansen Medical has only one competitor, Stereotaxis (STXS), but this emerging area and large enough for both companies to prosper. Sure it's a speculative stock, but so was Intuitive Surgical.

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