To OTC Journal Members:
 

Diomed Holdings (AMEX: DIO) - Opportunity or Challenge?

Today Diomed traded below $4 for the third time since becoming a public company on February 18th. Each time the stock has traded below $4, it rebounded nearly to the $5 level in short order.

As you can see from the chart, the stock is at the very bottom of support. Any further drop from these levels would be negative. However, each time the stock has traded this low in the past buyers have been rewarded with solid short term gains.

There has been no substantive news coming out of the company concerning the roll out of their FDA approved revolutionary new treatment for varicose veins, EVLT (EndoVenous Laser Treatment), which is why some investors are probably losing patience and selling at a loss. To learn more about EVLT, please read our May 1st edition, or visit the company's EVLT web site at www.evlt.com.

Diomed achieved about $7 million in sales in 2001. We expect the company to achieve $15 to $20 million in sales this year, with numbers accelerating rapidly in the 3rd and 4th quarters. More importantly, if Diomed's EVLT can replace 10% of the stripping procedures done annually for varicose veins, the company could enjoy $50 million in annual sales. This could be easily achieved in 2003.

As depicted in the chart, the stock is at the low point in its trading range. We believe there is a high probability it will rebound in the short term. Long term investors will make or lose money predicated on the successful roll out of EVLT.

If your style favors buying when no one else wants the stock, now is the time to jump in. When the company is reporting favorable developments you could be counting your profits. A good stop loss would be $3.50, with a short term price target of $5.00. We still maintain our price target of $10 for this year, which could be achieved when the market is ready to believe EVLT will be a commercial success.

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MarketByte LLC has been paid a fee of $100,000 in cash and 250,000 options convertible into free trading shares, exercisable at $3.50, by Mohammed Patel, an individual, for publishing information on Diomed Corp for a period of one year. Please review our policy on selling shares found on the Mission Statement on our home page.

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