AVA chart, page-477

Basically the technicals are saying that the SP could drop more to around 23-30 cent mark based on current trends, there is a possibility that the SP could drop to this range thus the 15c figure as a stop loss. Suggest you can start buying from now down to the 23c mark because there are plenty of traders who have bought the stock at much higher prices who are probably keen to get out on any sign of volume buying.

Here are the main points:

As of 31 March (nine months of FY21), Ava has banked $48.5 million in revenues. More than their final total for the prior financial year — a 48.2% increase on pcp. Gross margin improvements, EBITDA to 31 March clocked in at $13.1 million. A 138.3% increase over pcp.

Ava’s full-year guidance — revenues of $60–64million and EBIDTA of $13–15 million

But as CEO Rob Broomfield notes, this is largely due to pandemic-related delays which makes sense.

The update later goes on to state that $6 million worth of backlog orders have been pushed back to FY22. A reasonably large sum which will now bolster the company’s numbers into next year.

Despite the increasingly promising outlook, the market continues to sell this stock. A problem that seems beyond just the fear of delays and order backlogs.

One major shareholder significantly offloading their holding from August to February. Alkasab United Company, which held an 11.53% stake in Ava prior to 10 August, has quietly been selling. Dumping 13,600,256 shares over five separate transactions in recent months. More than halving their total stake down to 5.55%.

Ava looks to have been oversold. The current P/E ratio of 6.16 is indicative of that. With only a slight increase to a 7.81 P/E on forward estimates for FY21. Ava is trading at an Enterprise Value to Sales (EV/S) ratio of just 1.31 for FY21.
Company has no debt to speak of. With their net liabilities amounting to just $8.3 million at the end of FY20.

For these reasons, we recommend snapping up a stake in this small-cap when you can. Exposing yourself to a stock with an incredible balance sheet, and the potential for some impressive growth in the years to come