Will More Dentists Ask For Biolase Drills?

By Gene G. Marcial

The End Of A Long SLide?
A management shakeup and a new product at Biolase Technology (BLTI ) have rekindled interest in the stock, which has been in a deep funk. After hitting 21.39 on Jan. 21, it skidded to 5.91 in October. But it has since moved up to 9.08. Biolase makes laser dental drills -- quieter and less painful than conventional ones. An accounting change and the disruption of sales events in Florida and Louisiana by hurricanes battered earnings in the past two quarters.

The management revamp "is very positive," says Dalton Chandler of investment firm Needham, which has done banking for the company. Chief Operating Officer Robert Gordon was elevated to CEO, replacing Jeffrey Jones, who is now vice-chairman and chief tech officer. The new team, says Chandler, plans to spread awareness of the advantages of laser dentistry and broaden the use of its enamel-cutting technology in specialties such as orthopedics. A new dentistry product, Waterlase MD, launched on Oct. 1, is easier to use and more effective than the old model -- and sells for $70,000, up from $50,000, he says. He expects 2004 earnings of 4 cents a share, on sales of $59 million, and 22 cents on $88.6 million in 2005, vs. 2003's 83 cents on $49 million. Peter Cardillo of S.W. Bach, which owns shares, sees the stock at 16 in a year as earnings recover fully.

Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them.

See Gene on Fridays at 1:20 p.m. EST on CNNfn's The Money Gang.

    Before it's here, it's on the Bloomberg Terminal.