Omnicell Ind - Fundamentally Looks Good

Omnicell, Inc. is a leading provider of various medication control and patient safety solutions for acute care health facilities.

The company's healthcare automation solutions enable healthcare facilities to acquire, manage, dispense, and administer medications and medical-surgical supplies. It offers medication-use product line for use in acute care nursing departments, central pharmacy automation, physician order management, and nursing workflow automation at the bedside.

The company had very recently announced on Feb 25th, repurchase of an aggregate of up to $40 million of its common stock over the next 12 months. The Company’s Board of Directors decided to pursue this course of action after a review of the Company’s financial position and investment alternatives. The Company expects the stock repurchase program to be accretive to earnings.

This move had leaded the Omnicell stock to remain isolated with ongoing carnage and turmoil in stock market. The stock show strong buy signal and downside risk also looks quite less.

Omnicell also announced that it expects 2008 earnings from operating income will be higher than previously estimated and expects the estimated return on cash investments to be reduced to an average of 3% as a result of recent Federal Reserve rate reductions, which will offset the increases in operating income. After these adjusted estimates, Omnicell reaffirms its previous 2008 earnings forecast of $0.85 to $0.88 per share, excluding stock compensation charges.

Technically the stock looks quite good. The stock is certainly giving buy signal and has very good potential to touch $30 on mid term basis.

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