Tattoo-Removal Stocks: Buy the 'Tidal Wave'

Once it was art. Once it was cool. Now, it's just an ugly mess. Tattoo removal is a growing trend -- and Formula Capital's James Altucher says it's a trend investors should watch.

"On a daily basis, you see people worried about Apple's earnings, Google's earnings, oil, subprime, have to invest in trends that are never going away," he told CNBC. "Tens of millions (of baby boomers) have tattoos...maybe 100 percent of them regret it; it's going to be a booming industry."


So how does this translate into shrewd additions to a portfolio?

"Every tattoo is made by thousands of pinpricks with pigment inserted into your skin," he explained. "Lasers go in...and remove all the pigment...there's a few companies that specialize in the lasers that do this tattoo removal."

Topping his list is Cynosure,

"I consider this the Google of tattoo removal," he said. "The company has $60 million in cash, no debt, they trade for just eight times cash flow, and they're growing at 40 percent a year."

There's also Palomar.

"They have a $215 million market cap, $115 million cash in the bank, no debt," he said. "You have Cutera, with $90 million cash in the bank, no debt, and only $130 million market cap."

Altucher says they are bargains -- and they promise to be around for a long time.

"The entire market has driven these stocks down, and yet it's a tidal-wave trend," he said.


Disclosure information for James Altucher was not immediately available.