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MDSO: Adding Medidata Solutions to Investing Ideas

Takeaway: We are adding Medidata Solutions to Investing Ideas.

NoteThe excerpt below was written earlier today by Hedgeye CEO Keith McCullough. Stay tuned for further updates from our Healthcare sector head Tom Tobin.

 

MDSO: Adding Medidata Solutions to Investing Ideas - 45

 

Having not been the firm that told you to chase those "Dow Bro 18,000" highs...

 

Now we're in a position to signal buy on some of our Best Research Ideas. In addition to HOLX, Medidata (MDSO) is on Tom Tobin's Institutional Healthcare Team's Research list.

 

Medidata Solutions (MDSO) is a cloud-based provider of electronic data capture (EDC) and clinical trial management solutions to the Life Sciences industry.

 

Our screening process positions MDSO based on a composite ranking of under-performance, low sellside rating, and high short interest.  While we continue to hammer out the details of the tail thesis, on a trend duration, we expect revenue and earnings upside.

 

We have identified several Key Drivers that point to a material acceleration in application services revenue growth through 1Q15 (0.95 R^2).  

 

We believe the stock will trade above $65 versus the current price of $47 under our base case scenario, with the potential for higher prices over the next 12-18 months.

 

We will outline the details in a BlackBook presentation on 1/16 at 1 PM ET.

 

Buy red, at the low-end of the risk range - sell green, at the high.

 

KM 


Cartoon of the Day: Free Fallin'

Cartoon of the Day: Free Fallin' - Oil cartoon 01.05.2015

The crash in crude continues with oil plummeting over 5% today, falling below $50 for the first time since the Great Recession in April 2009.


DON’T SHORT THE RUSSELL!!

Takeaway: We are removing the Russell 2000 (IWM) from the short side of our intermediate-term thematic investment conclusions.

Q: What is the most appropriate risk management decision for an investor to make when presented with a security that is bearish TREND, bullish TAIL and smack-dab in the middle of its immediate-term risk range?

 

A: Nothing.

 

Indeed, doing nothing is sometimes the most appropriate investment strategy – which is exactly what we’re doing with respect to the Russell 2000 here.

 

DON’T SHORT THE RUSSELL!! - R2K

 

DON’T SHORT THE RUSSELL!! - 1 5 2015 2 27 19 PM

 

CLICK HERE to view the ~2min video.

 

Moreover, we no longer anticipate meaningful enough downside in the small-cap style factor over the intermediate term to warrant keeping the IWM on our condensed list of shorts per the thematic investment conclusions listed in our daily Macro Playbook, instead opting to replace it with the iShares TIPS Bond ETF (TIP).

 

We have been telegraphing this change for a few weeks now, but to the extent you’re not yet familiar with our logic, please tune in to our Q1 Macro Themes call on Thursday, January 8th at 1pm EST for more details surrounding this change and changes to our other core asset allocation recommendations.

 

Best of luck out there,

 

DD

 

Darius Dale

Associate: Macro Team


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Invite | Q1 2015 Macro Themes Conference Call

We will be hosting our highly-anticipated Quarterly Macro Themes conference call on Thursday, January 8th at 1:00pm EST. Led by CEO Keith McCullough, the presentation will detail the THREE MOST IMPORTANT MACRO TRENDS we have identified for the quarter and the associated investment implications.

 

Q1 2015 MACRO THEMES OVERVIEW:


  • Global #Deflation: Amid a backdrop of secular stagnation across developed economies, we continue to think cyclical forces - namely #StrongDollar commodity price deflation - will drag down reported inflation readings globally over the intermediate term. That is likely to weigh heavily upon long-term interest rates in the developed world, underpinning our bullish outlook for U.S. Treasury bonds. 
  • #Quad414: In the first quarter of 2015, we think growth in the U.S. is likely to accelerate from 4Q, aided by base effects and a broad-based pickup in real discretionary income. We do not, however, think such a pickup is sustainable, as we foresee another #Quad4 setup for the 2nd quarter. Risk managing these turns at the sector and style factor level will be the key to generating alpha in the U.S. equity market in 1H15.
  • Long #Housing?: The collective impact of rising rates, severe weather, waning investor interest, decelerating HPI, and tighter credit capsized housing in 2014.  2015 is setting up as the obverse with demand improving, the credit box opening and 2nd derivative price and volume trends beginning to inflect positively against progressively easier comps. We'll review the current dynamics and discuss whether the stage is set for a transition from under to outperformance for the complex.   

Invite | Q1 2015 Macro Themes Conference Call - HE MT 1Q15

 

CALL DETAILS


  • Number:
  • Password: 13598477
  • Materials: CLICK HERE (slides will be available approximately one hour prior to the start of the call)

 

Contact for more information.


McCullough: I Would Not Do What The Hedge Funds Are Doing $IWM

 

In this excerpt from today’s Real-Time Alerts Live show, Hedgeye CEO Keith McCullough addresses the performance of the Russell 2000 versus the S&P 500 in response to a subscriber question.

 

Subscribe to Real-Time Alerts for access to the full show, plus all of Keith's signals, #timestamped and sent right to your inbox - http://www.hedgeye.com/pages/individuals#real-time-alerts


McCullough: One Thing That Could Trigger a Recession

 

In this excerpt from today’s Real-Time Alerts Live show, Hedgeye CEO Keith McCullough responds to a subscriber’s question about whether a U.S. recession is coming. 

 

CLICK HERE to subscribe to Real-Time Alerts. With your subscription you'll receive all of Keith's #timestamped signals sent right to your inbox, as well as full access to this and all other RTA Live episodes. 


investing ideas

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