Stock Checkup: Meridian Bioscience Inc. (VIVO)

I wrote about Meridian Bioscience (VIVO) on April 7, 2009. This stock was trading at $16.90 then with a amazing yield of 4%. The stocks moved up 27% and closed today at $21.60.  I do not have any explanation for this movement except that Meridian at 4% yield is undervalued and should be bought. The chart below shows the performance of Meridian since 4/7/09.

Note that this stock took a big hit on 4/16 and someone accused me of "pumping". Here is a direct quote from "Jolly_Rancher" from SeekingAlpha "Just like most of the crummy stocks that are pumped here on seekingalpha, VIVO took a major dive today on lower guidance. Glad I passed on this one."

My model tells me Meridian is a buy at $14.50 range and strange enough this stock hit a yearly low of $14.79 on 4/16/09. I praised Meridian on their impressive dividend records and strong balance sheet. Today, I revised my model and strangely, my fair price for Meridian is at $21.60 (same as today closing price after falling 3.27% in a day).

As a value investor, my strategy is to buy shares of companies that are considered undervalue and sell the one that I consider to be fairly value. This stock is a great long-term investment but only at the right price. At this point, the shares have outperformed the Dow, S&P 500, Nasdaq, and Abbott (ABT) (see chart below).

If I want to remain in the market, I would sell Meridian and buy Abbott (yielding 3.6%) as a replacement. Jolly_Rancher you should have listened to me.

Art

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