It didn't take long:
Taipan's cornerstone play on diabetes treatment gets bought out at a 37% premium to our goal entry price! You could have made 86% if you followed our advice in early April!

by Brian Hicks

Medical device giant Medtronic is buying. And that’s great news. It’s even better news if you bought shares in one of Taipan’s cornerstone diabetes plays in early April… when we recommended you buy MiniMed (MNMD:NASDAQ) at levels under US$35.

Because Medtronic (which generates half its sales from defibrillators and pacemakers) is paying nearly US$3.1 billion to buy MiniMed’s strong presence in the market for treatment of the 16 million Americans with diabetes.

About 4.6 million Americans with diabetes must receive insulin through injections or pumps to regulate their blood glucose. Diabetes costs the nation about US$98 billion annually, including US$44 billion in direct medical costs.

The best way to monitor blood-glucose levels is through a system that continuously monitors and administers insulin. And that’s what MiniMed’s systems do.

Apparently Medtronic wants it really bad. The company will pay US$48 per share in cash for MiniMed.

And why not?

The number of Americans with diabetes has jumped from about 12 million in 1994 to about 16 million today. About 800,000 new cases of diabetes are diagnosed each year in the U.S., up from about 600,000 new cases per year in 1991.

Sure, we told you that our 2-year price target for MiniMed was US$55… which would have been a 57% gain over our recommended entry level. But honestly, we love being wrong in situations like this: we’ll take a 37% gain in two or three months any old time. Heck, if you acted on our recommendation when the issue arrived, you had the opportunity to buy in at US$26. Then you’d have bagged a cool 86% gain. Not bad in a market prematurely declared dead on arrival in early 2001.

Another record quarter for Optimal Robotics
Optimal Robotics (OPMR:NASDAQ) recently announced record results for the first quarter of fiscal year 2001.

The company reported record revenues of US$19.6 million for the first quarter, compared to US$12 million for the same period a year ago. That’s an increase of 63%.

Net profit for the quarter was a record US$2.5 million, an increase of 259%, compared to a net profit of US$701,218 for the first quarter of 2000.

Optimal Robotics delivered 797 U-Scan self-checkout terminals (or 200 U-Scan systems) in the quarter, an increase of 74% over the 460 U-Scan terminals (or 115 U-Scan systems) delivered in the first quarter of 2000.

Thanks to these stellar numbers and other positive developments, Optimal Robotics recently broke above US$30.

In addition to the better-than-expected fundamentals, there are reports that beta testing at Wal-Mart is going well.

The maker of self-checkout systems for grocery stores has seen robust institutional buying in the past three months.

Being there first
One thing I always tell individual investors: there are two types of stocks—those that Wall Street loves… and the ones that you should buy.

They are mutually exclusive.

What does this mean?

If you’ve been with Taipan for a few years, you know that my prime directive is to uncover, analyze and purchase stocks not yet followed by the Street.

I won’t get into how the Wall Street game is rigged against you, but in essence, you want to buy before mutual funds begin acquiring positions in the stock.

Optimal Robotics is an excellent example.

When I originally recommended OPMR in 1998 for US$11 a share, the stock had zero institutional sponsorship. Today, more than 74 institutions hold OPMR.

In the past three months, institutions bought 6.5 million shares, while selling only 1.8 million—for a net gain of 4.7 million.

This is bullish, no matter how you look at it.

The same goes for Aviron (AVIR:NASDAQ). Institutions bought 8.4 million shares in the past three months… and sold only 3.3 million.

Buyers outnumbered sellers 92 to 35.

In short, when mutual funds begin buying, it’s Taipan members who are doing the selling… and usually at a fat premium over our entry price.

No end in sight for tainted meat—Titan powers higher
Europe is still in a foot-and-mouth disease crisis. In fact, more animals are being led to slaughter than ever before.

I don’t think it is a coincidence that Titan (TTN:NYSE), our meat pasteurization play, is experiencing a major rally.

In fact, the recent IPO that Titan owns 84% of—SureBeam (SURE:NASDAQ)—is up more than 100% since mid April.

There continues to be a buzz about Mad Cow and foot-and-mouth diseases.

And although Titan’s meat pasteurization system doesn’t directly address these diseases, the meat-eating public definitely wants safer meat to consume.

Titan is currently up about 50% in the Taipan portfolio… and I think it will go higher in the coming months.

Continue to hold.