$HBIO Stub Trading at Deep Discount to Life Science Comps

This is a micro/small cap pick. Harvard Bioscience spun off its R&D; (cash burning) division to shareholders in November 2013. Post spin-off, $HBIO is a highly profitable, pure-play life sciences instrumentation and consumables company, trading at a deep (~50%) discount to its peer group. Moreover, $HBIO has very recently hired new CEO and CFO, both with impressive resumes. These gentlemen have been incentivized with a lot of stock and options and so their interests are aligned squarely with shareholders. After joining the company, new management has started to cut costs and improve profitability further. I think one of two things will happen over the next couple of years to $HBIO: Either it will scale up via acquisitions or sell itself to a larger competitor like Perkin Elmer ($PKI) or Thermo Fisher Scientific ($TMO). I think the latter is the the more likely scenario. The spin-off $HART is also worth a look but this is an early-stage development company and way outside my comfort zone.