Friday, August 10, 2007

I-Flow Corporation

I-Flow Corporation is a NASDAQ listed security that has been trading in a range between $11.01 and $19.06 over the past year. With 24,219,080 shares outstanding, a recent price of $17.52 gives a total market capitalization of $443,935,735. While there are certainly larger companies, I-Flow Corporation has definitely earned its place in the pack. Last year, I-Flow Corporation created $0.54 in earnings for every share outstanding.

I-Flow Corporation is currently priced by the market at 42.50 times last year’s earnings. Many trading multiples around the world are quite attractive these days, but don’t be fooled. A Price to Earnings ratio of 0 simply means that the security didn’t make any money last year.

With a share price under $50 a share and earnings per share below $1 a share, I-Flow Corporation could be an interesting value proposition. Consistent earnings are the key to high valuations and this security is well on its way.