Ann: Becoming a substantial holder-SRX.AX, page-18

Hi Gareth et al,

Look, no question the SP trend over recent months has been disappointing and has cost all of us some serious $.

In response to your "negative articles" plea, here are just some risks as i see them:
(1) Poor results in any or all of the upcoming trial announcements
(2) good (1.e. better than SRX) results announced from one or more competitors
(3) competitive pressure from BTG and others - e.g. free/discounted product
(4) lack of progress with reimbursement in various jurisdictions
(5) general progress in this field tends to be glacial (e.g. over 12 months for SIRFLOX results to be released as "Urgent" in key publications
(6) need to persuade conservative physicians in every jurisdiction that this is better than the treatment they have been using for years.
(7) cost of sales, marketing, education etc could increase at a greater rate than product sales
(8) money being poured into R&D with no tangible outcomes
(9) poor / no management either globally or in key regions e.g. Asia
(10) SP movement may not be in any way related to company performance, dominated by short-sellers and speculators
(11) and almost certainly others.....

My magic spreadsheet, based on recent sales performance, is telling me that current FV based on dose sales of 15% this year (lower end of recent SRX press release) is about $26. So it's probably fairly priced at the moment. However, (and this is why I am heavily invested!) assuming positive results from known trials, and reasonable growth in dose sale resulting from this, I predict huge revenue in FY 2019 and FY 2020 which even GW can't completely waste.

So all things being equal I am anticipating a SP of up to $70 in July 2019 and $100 in July 2020.

The reason I am holding now, and not waiting, is that it is possible, if not probable, that other major pharmas are also looking at SRX and waiting until the risk/reward is indisputable. An offer of as little as $50 is possible, as soon as this year, if SARAH results are good. I don't want to take $50, based on forward projections, but doubling my money this year is better than selling out and getting nothing.

By the way, the infamous Benjamin Graham of Intelligent Investor fame would be pricing SRX as eps x (8.5 +2g) where g is the 7-10 yr growth rate in eps. So if trailing earnings are (say) 85c and growth in earnings (not revenue) is 15% then Graham would be paying up to $32.75.