Cytori is in an enviable position where they can generate clinical data that could have an immediate impact on sales of already approved products.

That is a benefit over most biotechnology companies, but still doesn't alleviate the clinical trial risk. Until we see data from RESTORE-2, VENUS, PRECISE, and APOLLO it is difficult to forecast the ramp in product sales. That being said, third-party stem cell research has the potential to drive sales of Cytori's products. Also, as academia and private organizations expand their stem cell platforms there exists significant opportunity for Cytori to receive revenues form Lonza and Invitrogen.

We think 2008 has the potential to be a very exciting year for Cytori and we encourage investors to stay-tuned. Right now we see $8 as fair-value based on $276.7 million in revenues in 2012 generating $2.17 in EPS. We apply an industry-like 25x multiple and discount back to present day at 35%.

Dividend Balances KT Corp. Issues

KT Corporation's (KTC) fixed-line revenue is likely to decline over the near-term, as wireless substitution continues and VoIP competition enters the market. Intensifying broadband competition and continued regulatory pressures are also expected to compress future revenue growth levels.

Meanwhile, KT paid a dividend of $1.07 (KRW 2,000) which equates to a payout yield of 4.9%. We see limited downside in the shares due to KT's higher dividend and modest valuation.

However, the company's business catalysts are not yet entirely convincing that would drive up share demand, in our opinion, and therefore we maintain our Hold recommendation. KT is trading at a forward multiple of 12.5x our 2008 EPADS estimate, which is in the mid-range for its global peers.

We expect KT to generate modest top-line growth, and the company's cost structure is relatively inflexible due to government regulations and the power of its trade unions. Therefore, the below-average valuation is warranted to some degree, at least over the near-term.

Admittedly, the company's leadership position in the Korean telecom market and its focus on next-generation broadband and wireless services should partially offset the effects of intensifying competition and a difficult regulatory environment. The stock price also fluctuates based on the outlook for the Korean economy and changes in the KRW/US$ exchange rate. Our six-month $26 price target is based on a target P/E of 15x our 2008 EPADS estimate.

Trends Keep RH Donnelly a Hold

We rate the shares of R.H. Donnelley Corporation (RHD) a Hold following the release of first quarter 2008 financial results. The company continues to generate substantial cash flow, although we note that debt currently comprises more than 90% of total enterprise value. The company expects ad sales declines in the mid single-digits in 2008, and we project relatively flat EBITDA generation this year.

Given ongoing concerns about an economic slowdown, we remain cautious on shares of RHD.