China Medical Technologies develops, manufacturers, and markets medical devices for the treatment of solid cancers and benign tumors in China. China Medical used to be focused on its ultrasound machines used to kill tumor cells but have recently focused on diagnostic tests such as ECLIA. ECLIA detects levels of light and looks at diagnostic markers in blood and other body fluids. This change (ECLIA and FISH) has been the catalyst for revenue growth. FISH and ECLIA make up 60% of revenues and they plan to expand from 200 to 500 hospitals by the end of the year. There has been a lot of news on diagnostic test makers such as HOLX and its clear that this field is becoming popular.
Fundamentally, CMED’s revenue was up 74% year over year. Earnings per share were also up 38% despite having to launch its fluorescent in situ hybridization (FISH) imaging analysis system.
I like CMED based on their ability to roll out new technology successfully in China. There may be better gems that can grow faster based on their size but I think CMED is still trading cheap (24PE).
Below is some technical analysis
What do you guys think about CMED’s future?

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