Stock Alerts for MELA Sciences Inc. (MELA)
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    Stock Alert for MELA Sciences Inc. (MELA)

    MELA Sciences Inc. (Nasdaq: MELA) is a medical device company focused on the design, development and commercialization of a non-invasive, point-of-care instrument to assist in the early diagnosis of melanoma. The Company’s product MelaFind, features a hand-held imaging device, which emits of light of multiple wavelengths to capture images of suspicious pigmented skin lesions and extract data. The data are then analyzed utilizing image processing classification algorithms, trained on the database of melanomas and benign lesions, to provide information to assist in the management of the patient, including information useful in the decision of whether to biopsy the lesion. The Company filed the MelaFind pre-market approval application with the U.S. Food and Drug Administration (FDA) in June 2009 and is under review at the FDA.

    MELA was founded in 1989 and is based in Irvington, New York.

    Share Statistics (19-Nov-10) FY

    2008

    FY

    2009

    %

    Chg

    Q2

    2009

    Q2

    2010

    %

    Chg

    Symbol MELA Revenue, $Mn 0.00 0.00 0.00 0.00
    Current price $4.98 Gross marg.
    52wk Range: $2.51-12.24 Oper. margin
    Avg Vol (3m): 885,998 Net margin
    Market Cap. 125.71M
    Shares Outstanding 25.25M EPS, $ -1.08 -0.96 -11.1% -0.26 -0.20 -23.1%

    Source: Reuters.com, SEC Filings.

    Financial Summary


    Financial Strength (Nov-11-2010) Company Industry Sector S&P 500
    Quick Ratio (MRQ) 1.79 2.23 0.67
    Current Ratio (MRQ) 20.02 2.26 2.81 0.99
    LT Debt to Equity (MRQ) 0.00 175.69 23.50 119.06
    Total Debt to Equity (MRQ) 0.00 211.72 27.92 173.75
    Interest Coverage (TTM) 1.70 1.25 18.97

    Source: Reuters.com, SEC Filings.

    Analyst Consensus

    This is the consensus forecast among three polled investment analysts. Against the MELA Sciences Inc company.

    Analyst Detail Buy Outperform Hold Underperform Sell No Opinion
    Latest 1 2 0 0 0 0
    4 weeks ago 1 2 0 0 0 0
    2 months ago 1 2 0 0 0 0
    3 months ago 1 2 0 0 0 0
    Last year 1 2 1 0 0 0

    The three analysts offering 12-month price targets for MELA have a median target of 10.00, with a high estimate of 14.00 and a low estimate of 9.00. The median estimate represents a 295.26% increase from the last price of 2.53.

    Source: markets.ft.com

    Consensus Estimates Analysis


    # of Estimates Mean High Low 1 Year Ago
    SALES (in millions)
    Quarter Ending Dec-10 3 0.00 0.00 0.00 2.95
    Quarter Ending Mar-11 1 0.61 0.61 0.61 3.37
    Year Ending Dec-10 3 0.00 0.00 0.00 5.12
    Year Ending Dec-11 3 7.27 9.82 3.40 29.92
    EARNINGS (per share)
    Quarter Ending Dec-10 3 -0.25 -0.21 -0.30 -0.21
    Quarter Ending Mar-11 3 -0.27 -0.24 -0.34 -0.21
    Year Ending Dec-10 4 -0.90 -0.84 -0.95 -1.00
    Year Ending Dec-11 3 -1.00 -0.87 -1.10 -0.29
    LT Growth Rate (%) 1 40.00 40.00 40.00 40.00

    Source: http://www.reuters.com/finance/stocks/financialHighlights?symbol=MELA.A


    Investment Highlights

    MELA designed MelaFind to assist in the evaluation of pigmented skin lesions, including atypical moles, which have one or more clinical or historical characteristics of melanoma, before a final decision to biopsy has been rendered. MelaFind acquires and displays multi-spectral (from blue to near infrared) digital images of pigmented skin lesions and uses automatic image analysis and statistical pattern recognition to help identify lesions to be considered for biopsy to rule out melanoma. Melanoma is the deadliest of all skin cancers. However, early detection of skin cancers like melanoma can lead to virtually a 100% cure rate.  According to the National Cancer Institute’s estimates, more than 68,000 diagnoses of melanoma are expected in the United States this year, while another 8,700 will die from the disease.

    In October, the Company announced the results of its MelaFind pivotal trial and pilot reader study have been published in the online edition of the journal Archives of Dermatology. The paper will appear in the February 2011 print edition of the journal. The paper shows that MelaFind’s performance satisfied all primary and secondary sensitivity and specificity endpoints, as defined by the study protocol and a Protocol Agreement between MELA and the FDA.

    Recent Company News

    MELA shares were boosted last week after an FDA panel narrowly voted in favor of its skin cancer detection device, Melafind. The General and Plastics Surgery Devices Panel appointed by the FDA voted by majority that, for its proposed indications, MelaFind is safe and effective and that its benefits outweigh the risks.

    “I believe that MelaFind can be a valuable tool to provide input into the decision to biopsy suspicious skin lesions and may ultimately help save lives,” Darrell Rigel MD, clinical professor of Dermatology at New York University Medical School, commented in a press release.

    According to Clay J. Cockerell MD, clinical professor of Dermatology & Pathology at the University of Texas Southwest Medical Center, MelaFind “will also help dermatologists who evaluate pigmented skin lesions under the microscope to be more accurate in diagnosis.”

    MELA president and CEO Joseph V. Gulfo MD said the Company looks forward to working with the FDA during its ongoing review of the MelaFind pre-market approval application.

    Prior to the recommendation, the FDA expressed concerns regarding the investigational device’s utility, safety and efficacy. “The FDA review team has significant concerns this device has not been studied adequately for its current indications for use and therefore puts the health of the public at risk,” the FDA said in documents released on Tuesday. FDA reviewers have recommended that an additional study be conducted.

    In its documents, MELA said there are “critical points of disagreement” between the Company and U.S. health regulators over its study of its device, and it outlined 13 areas of disagreement with the FDA. MELA said the FDA staff believes that “the fatal risk of missing melanomas (two of 127) is not worth the marginal benefit of a clinically meaningless reduction in biopsy ratio compared to dermatologists.” According to the Company, this view was “completely without context.”

    The Company said the FDA has not provided a date as to when it will make a decision regarding the MelaFind pre-market approval application.

    Source:  reuters.com; http://www.melasciences.com

    Technical Analysis

    Source: http://stockcharts.com

    MELA is below its 13-day moving average. This bearish sign is even more significant because the moving average is also trending lower.

    MELA’s recent volatility has been greater than normal. This is evidenced by the increased distance between the upper and lower Bollinger Bands. These bands measure volatility using standard deviation and a large width is due to high volatility.

    The MACD for MELA currently indicates a strong bearish signal for two reasons. First, the MACD is below the signal line, a 9-day moving average. Second, the MACD is below the critical level of 0, which implies that the underlying moving averages are trending lower.

    Comparative Analysis

    Company Name Ticker Price per Mrkt. Cap. P/E P/S
    Nov19-2010 symbol Share, $ $ Mn 2010 2011 2010 2011
    Accuray Inc. ARAY 5.97 349.89M n/a 42.64 160 1.41
    Varian Medical Systems Inc. VAR 65.00 7.74B 19.40 17.11 2.99 2.75
    BSD Medical Corp. BSDM 5.66 141.10M 97.31 72.36
    Hologic Inc. HOLX 16.15 4.19B 13.24 12.14 2.39 2.29
    TomoTherapy Inc. TOMO 3.46 179.69M n/a n/a 0.98 0.87

    Medical Instruments & Supplies Median

    19.60 n/a 1.90 n/a
    MELA Sciences Inc. MELA 4.98 125.71M n/a n/a n/a 17.27

    Source: Thomson Financial

    Insider Trading Activity

    NET SHARES PURCHSE ACTIVITY

    Inside Purchases – Last 6 Months

    Shares Transaction
    Purchases 37,750 8
    Sales n/a 0
    Net Shares Purchased (Sold) 37,750 8
    Total Insider Shares Held 1.13M n/a
    % Net Shares Purchased (Sold) 3.5% n/a
    Net Institutional Purchases — Prior Qtr to Latest Qtr
    Shares
    Net Shares Purchased (Sold) 1,106,200
    % Change in Institutional Shares Held 10.27%

    Source: Yahoo Finance

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