Large deals with health care insurance companies could amplify growth. Coastal Contacts provides eyeglasses at approximately 50% lower cost than conventional retailers. That's opening up opportunities among managed care providers that want to provide eye car insurance at low costs.
The company's contact lens business continues to grow at a 5%-10% rate. That segment had been starved for advertising funds before the recent stock offering. Business in Northern Europe and Canada had held up well despite that lack of marketing effort. Renewed spending promises to reinforce the company's competitive position in upcoming quarters.
In 4-5 years pretax margins could reach 20%-25%. We project they will attain half that level by 2014-2015 as marketing costs continue to rise quickly, laying the groundwork for further sales improvements. In 2-3 years sales could reach $325 million to provide fully taxed earnings of $.75 a share. In 4-5 years income could hit $2.00 a share.
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