I find discussion on m/c and sp really interesting. but with so much unknown it is all just guess work. this is my take.
we have a raw material deal with Ellume, who by mid year ,when their US manufacturing base is operational will produce at a minimum 200m tests a year with the AUS manufacturing operations included. we have the existing 5 year supply deal to be renegotiated in October. if you also add revenue from Serum institute of india, the just reported antibody drug development client in the US, IMRA and Luminex it could be argued that we will be cash flow neutral or even +ve, just from this section of our company.
Derek also said in the interview that we also have Anteobind included in several products in development. we already know this from Charlie's webinars and 77e was declared in last years annual report being close to having a test completed. all future revenue to be added to the above.
so that leaves us to justify our current m/cap of around $400m.
I will work backwards. if we go from a company that has made $318k and $245k in the last 2 quarters to a company that could be making say $2m+ a quarter later in the year, our pe won't be 20 or 30. I posted a couple week ago
50603212 NAN sp $6.72, m/cap, $2.059B, 2020 profit $10.137m, pe 243.9x.
so with a profit of $10.1 m NAN had a m/cap of $2b and a massive pe of 240.
plenty of other examples of quickly growing revenue companies having huge pe's. to be conservative I will make ours at 40.
$400m m/cap at a pe of 40 would require a profit of $10m.
we have Operon who seem to me to be playing more of a role of joint developer of our test than just a simple manufacturer, could produce up to 8m test a year. (could be less, could be more) we have the $1.4m grant stipulations of Queensland production of 1m tests. (ellume probably). adding up to 9m tests.
that means we would need to make $1.11 a test to justify our m/cap... (we have had some figures of $5 a test profit but we don't know)
sure a lot of assumptions, but would we need teams on the ground setting up distribution networks if our total manufacturing capability was less than 9m tests a year? thats only
750k a month. ellume will have production capacity of
500k in the US and 200k in AUS per day... we will have 3 very accurate sensitive tests swab, saliva and multiplex covid/flu. yes the holy grail of testing an accurate saliva test. also when the team finish development with our covid/flu test they will then move on to our sepsis test, that management have claimed will be commercialised in 2021. under other tests.
https://www.anteotech.com/covid-19/we also had a hint of selling in the US and Asia in the interview. remember from one of the webinars from late last year when Derek said there is testing to be done in the US and Europe and Israel and results will be released if they were allowed. so they haven't been allowed but plenty of hints have been given of future licencing deals. the market is forward looking how much manufacturing would that allow. is Operon our only manufacturer in Europe.
all things to be weighed up... are we over valued or undervalued.
and lastly we have some of our battery collaborators testing our CLA with results expected later this month, so in about 2 weeks. doing in house testing to confirm Coll 8, 21% performance improvement. any deal from here would send the sp a lot higher..
anyway all imo, DYOR, GLATH, a lot happening in the next 6 weeks. so not too long before we know a lot more and be able to do more precise calculations.... it's not difficult to see what my opinion is....
