'Pouring with rain where I live today, so though I would go through the exercise of updating my 3 to 4 year "back of envelope" projections for CDX ( and a couple of others ), updating my data where needed. I'm happy to share my workings, provided no one treats it like financial advise ... just the musing of a vested shareholder, and perhaps a chance to re-examine your own assumptions on your models.
This analysis represents a positive view of outcomes. I tend to only start assigning a SP once we have +ve cash flow and a PE can be applied. Before then it's all speculation on future returns, but I note MST Access have us valued at $1.11 on latest report dated 3/3/23.
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Some of my assumptions
- Covering FY's, starting 1/7/23
- FDA grants clearance for Pulse for prescription only this quarter, manufactured and available for sale Q1 FY 2324
- RRP $350 ( increases over time ), 40% margin on a wholesale price of $175
- Atcor Medical drives significant business through FDA push to decentralised & representative clinical trials.
- Licensing moves beyond Mobvoi, with LifeQ picking up a few contracts for CardieX
- Pulse lease model into GP clinics etc at $50 per month, margin improves as units delpoyed paid off ( about 6 months )
- Conneqt Band does not achieve FDA clearance until mid-2024.
- Pulse cleared for OTC sales in Q4, 2024.
- SaaS business , $10 per month subscription, sticky retention at 50% per year. 50% of new users subscribe
- PE ratio of 25. Medical Device has been running at over 35, so this is discounted.
- SOI goes up to the equivalent of 225M after US Listing, then holds steady as no further raising required as cash positive FY 2425
- Sales are derived from the bottom up, and then discounted by 60%.
eg distribution in Walgreens after Pulse achieves OTC clearance
5,000 stores x 2units per week x 52 weeks = 520,000 units per year.
Again, this is what could happen if everything goes right and the macro picture turns positive.
Possible -ves :
- Pulse does not get clearance, program put back 12 months as issues addressed.
- Band takes longer to achieve technology to warrant FDA clearance - launch June 2025
- Omron becomes aggressive in debunking value of CBP ( although the body of evidence over 20 years is compelling ).
- Craig & or Niall exit the business.
Plus all the glass half empty view of the CardieX program over the next 3 years.
So, in this scenario, in June 2027, 4.25 years from now, our MC would be $2.6B and paying a dividend.
Craig has often floated our competitive set in presentations with valuations at this level ... it may just be possible.
This is NOT Financial Advice.
Please DYOR.
