MACKIE COMMENTSOvernight, Patient Home Monitoring (PHM-V) reported their Q3 numbers and they were quite a bit better than I expected. The restructuring efforts by new management Casey Hoyt and Mike Moore look like they are working. I was worried that they might burn through too much of their cash during the cleaning up which included writing off some bad debts, laying off employees from businesses that had been acquired and who were no longer motivated, and shutting down some low margin businesses. They appear to have accomplished most of this over the last two Qs. It looks like they are turning the corner. They delivered moderate revenue growth of 5% after adj. for currency, and are stabilizing at a run rate of revenue of $130m. They are reporting gross margins of 71% which suggests they should get back to making meaningful EBITDA in the next few Qs as EBITDA margins should be 15% and are currently running at 5%. The balance sheet looks OK with cash and recievables at $30m and debt of $15m. PHM has been through the ringer in the last year, dragging some of us through it too. Lofty expectations of reaching $200m in revenues and $45m in EBITDA didnt happen after the roll up turned off. New management replaced a group of insiders who sold their shares, and they have unrolled some of the companies. They also faced a large re-imbursement cut from Medicare that hammered margins on their core ventilator business. Given all of this disappointment, I am not surprised it traded at of sales at the bottom or that it is now trading at just 0.7x EV/Sales right now. It should trade at 1x sales or $0.50/share now that they have stopped the bleeding. If they can deliver revenue of $150m and $22.5m of EBITDA, it should trade at 8-10x EV/EBITDA again, which would give you a 2017 price target of closer to $0.60. This looks like decent value here at $0.23, and I look forward to hearing from management tonight on the 4.30pm conference call. The dial in is 855-886-8711 password 61820663.