Tuesday, June 24, 2008

BlueLine Partners Discloses 5.3% Stake in Angeion (ANGN), Calls Stock Undervalued

In a 13D filing after the close on Angeion Corp. (Nasdaq: ANGN), BlueLine Partners disclosed a 5.3% stake (216,475 shares) in the company.

BlueLine noted that shares of Angeion have been prone to overreactions. They noted that investors drove the stock up from $5 to $18 in 2006, which they said was unwarranted. They said once orders declined and additional clinical orders failed to materialize, the Company's shares plummeted.

BlueLine suggested that with a market capitalization of less than $25 million, the shares are undervalued. BlueLine said taking into account the Company's cash holdings of more than $7 million, the market is currently valuing Angeion's ongoing business at less than $20 million. They said this seems clearly wrong for a company whose core business is generating quarterly revenues of $7.0 million with 50% gross margins and positive cash-flow. BlueLine believes the market has grossly over-corrected the share price, and at current levels, Angeion represents compelling value.

BlueLine believes the Company's product line is competitive in its space, and that management's strategy is sound. Operationally, BlueLine is encouraged by recent cost reductions that have lowered the company’s breakeven point. They also said the hiring of a new CFO with public company experience has improved the Company's investor relations practices.

An area where BlueLine believes Angeion still requires improvement is in setting and communicating policies around employee compensation.

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