Look for medical tech company TSO3 (TSO3 Stock Quote, Chart TSX:TOS) to become EBITDA-positive this year, says Echelon Wealth Partners analyst Douglas W. Loe, who in a client update on Wednesday reiterated his \u201cBuy\u201d rating and C$1.80 price target for TSO3, representing a projected return of 181 per cent at the time of publication. Loe focuses on TSO3\u2019s Sterizone VP4 Sterilizer, a low-temperature sterilization system which is the only terminal sterilization method FDA cleared to sterilize multi-channeled flexible endoscopes of up to 3.5 metres in length (such as video conoscopes and gastroscopes). On Tuesday, TSO3 announced that it had sold 21 VP4 units from its finished goods inventory repurchased from legacy global channel partner Getinge AB, which Loe takes as a measure of the VP4\u2019s demand. Loe believes the company can generate capital sales from 190 VP4 units in its fiscal 2019, with increases over the ensuing four years which still leave a tonne of room for growth. \u201cIf achieved, our cumulative VP4 sales projection for F2019-F2023 would represent 2,065 VP4 units and when added to the 66 VP4 units already installed so far, would still represent only about 7 per cent of the global hospital low-temperature sterilization market, a trivial proportion of the global market currently dominated by Fortiva, Steris, Cantel Medical and former TSO3 partners 3M Healthcare and Getinge,\u201d says Loe. \u201cOur model still assumes that TSO3 has sufficient capital ($16.1 million at end of FQ318, along with $17.4 million in total debt) to fund operations to profitability, and we in fact project that the firm could be modestly EBITDA-positive as early as this year (Exhibit 1), assuming our VP4 unit sales forecast is achievable and that higher-margin consumables sales and maintenance\/service revenue will ramp in lockstep with installed base ramp,\u201d he says. TSO3 last released its quarterly financials on November 6, where it posted fiscal third quarter 2018 revenue of $0.8 million, which was double that of the previous quarter but less than the $5.1 million a year prior. The quarter also featured a net loss of $2.1 million or $0.02 per share. (All figures in US dollars unless noted otherwise.) \u201cTSO3 has established a goal to ship or receive commitments for 200 Sterizone VP4 Sterilizers by the end of 2019,\u201d stated R.M. (Ric) Rumble, President and CEO of TSO3, in the quarterly release. \u201cWe have now purchased the inventory we need at favourable pricing, raised capital and hired and trained a team of experienced sales and service personnel in support of this goal.\u201d Loe says that he\u2019d like to see some public advocacy on behalf of hospital clients and academic collaborators concerning VP4\u2019s capabilities and the company could benefit from enhancing VP4\u2019s profile in the medical literature, he states. \u201cWe are encouraged by recent share price response to VP4 sales traction just achieved, but our model assumes that recent sales levels are trivial in comparison to levels that we believe VP4\u2019s technical specifications support in the global low-temperature sterilization market,\u201d says Loe.