HMD (ASX) HMD Chart

Originally posted by dunnomuch: ↑

I guess that's about right..

in the red corner is "total dumpster fire for capital"
-poor communication. Announcements that reveal little in the way of material wins but come across as a complex sounding nothing leads to lack of market trust. Talk of a mysterious social media company but nothing publicly announced just ends up sounding a bit amateur. Why weren't the CPT codes announced and clarified as to what that means for future US based revenue? e-Lōvu AND HMD are both beneficiaries of this information.. where is the investor brief outlining what COULD be just over the event horizon of capital exhaustion??
-limited revenue. $340k USD last quarter but can that even be replicated let alone improved upon. Sub $1m/year revenue is not worth much and then there are the costs incurred by the business..
-almost out of cash. There was enough for just over 2 quarters of cash in the bank on March 31, we are almost through June so 1 quarter is effectively gone from that account. Raising at $16m Market Cap is going to deliver 10% of that as a raise based on the rules of raises so enough for just over 2 quarters of spend... back to a raise on NYE doesn't sound like a great party... maybe a material restructure of the capital of the business might be in order.. that's a big deal... raising 30% of the company's value in order to give sufficient runway is a bit dire but are we out of those woods or just about to walk into a bushfire?
-desperate need for capital raise and/or material shift in revenue. 10% raise only covers the remainder of this year unless there is a significant shift in revenues. 2 raises in a year looks appalling but we might be in that boat.. I think that the board thought that the deal with entrustia and fond was enough of a deal maker to hold out a raise until the market reacted favourably. in hindsight a raise should have happened just after the quarterly but that would have seemed like a raise just to keep the lights on however now it will be a raise just to keep the lights on.... whoops... maybe there was something that is on the back burner that they thought would have come through by now hence the holding out of a raise... if so, where the crazy bananas is it????
-fractured markets (JHC, Melbourne Mums, Joondy O/G etc but no RHC overarching deal). HMD is also effectively going to be competition for e-Lōvu, how does that play out? GC Health could potentially open up QLD health or maybe it won't? without a major signing HMD just looks like a cool gadget and not the new standard of care that is spoken about. Wed are now 6 months post JHC deal deadline and counting... but other clinics are signing up from the RHC world and thats ok..now... or is that a bit of a miss too.... we need a big name sign up in some volume so as to create the weight in the market.
-speed of adoption. what happened to the pipeline? based on JHC's experience and the deal with GC Health it would appear that about 12 months is needed from first signup to going commercial. currently 1 deal is in that pipeline and its the GC one... that is a 12 month wait and in between is crickets... not the fun sport kind of crickets either... for FY24 to turn around there needs to be 3-4 pilots starting VERY soon... VERY VERY soon...

in the green corner is "the opportunity of a lifetime"
-tech works at gold standard level. There are consistent results across multiple hospitals over different countries that the tech of the HeraBEAT is at Gold Standard level comparable to the Philips CTG machine. That's irrefutable and peer reviewed. There is no doubt that the device is exactly what it says it is and fills an actual need within a market of significant size. HeraCARE is proven as an effective tech platform and the algorithm used has detected pre-eclampsia and is being shown to be highly effective in dealing with gestational diabetes. HMD has a product that works and works at the highest level.
-easy to use as per above, the device has been consistently shown to be VERY easy to use. even in areas of war and conflict the training needed for nurses to administer care is measured in minutes not hours or days etc.. regular people with an app on their phone are able to use HeraCARE at precise levels. the barrier to use is pretty low which should result in easy market penetration.
-replicated results across countries Australia, Israel, USA, Brazil, Ukraine, Western Australia (every one knows they think they're a different country) different countries with different health care systems and different cultural backgrounds etc have all been able to use the device and platform so it should be a very easy to scale solution should we find more widespread adoption. different models are not required for different markets which benefits economies of scale.
-scalable platform There is every indication that the platform is able to go to scale and not have issues. The platform is robust enough that it is the basis for e-Lovu to create a business from. it is able to be integrated into systems in multiple countries and in multiple languages.
-early adopters first mover advantage is still a real thing here.. Telehealth and remote monitoring is not going away and HMD is right at the tip of the spear. the companies that get started first in these scenarios will usually outgrow new competition and create an economic moat of scale that simply becomes too great to replace.
-margins Telehealth margins are in the mid to high 90% range which is incredible. It will not take much to turn total annihilation into a win
-CPT codes in the USA FDA approval is a super handy thing to have granted but having FDA and CPT codes means that it is able to be used and reimbursed... this is in my opinion the keystone to the investment thesis. there is a massive market that can't stop (until the robots take over) and it is in need of a remote model and we have that PLUS the payment side. EVERY prior attempt to get HeraCARE up and running in the USA was stymied by the lack of clear reimbursement. that is now cleared... if we just had a clear pipeline over there we would probably be flying but alas... poor communication
-commercial deals although on the small end of things there are in fact multiple sites using HeraCARE and paying for it. There is revenue and it is more than it was last year... just on the light side of things but it is there and it is growing
-low market cap $16m.... it was worth $16m 3 years ago when it didn't have CPT codes or any commercial deals or a clear strategy anywhere in the world... if they can book $1m/quarter in revenue then it pays for itself. thats got to have some pretty asymmetrical risk to the upside.. zero is only 6 or 7 ticks away but a win could treble things from here and still not be worth very much
-some good people Ron and Keith sound like a couple of western Qld graziers and we kind of are playing for sheep stations on the upside so thats a bonus. Anoushka is very driven and is really pounding the pavement looking for new deals. However we need 3-4 solid pilots signed up to get fy24 roaring into life.
-low hurdles to success This is the fun bit... each pregnancy in the USA will be billed at somewhere around that $600 mark which is the full fee, no discounts. the margin on that is close to 95% or more so $600 in revenue is $570+ in margin. 1,000 pregnancies is $570,000 in revenue. 5,000 pregnancies a year signing up in the USA gets us over the line of revenue neutral. That's a low hurdle to success. 10,000 signed up in a year is achievable based on current corporate headcount and funding streams to produce enough devices... its not much needed to get over the line.

HMD is so cheap or so expensive... dunno? clearly the market is not on HC as they are all in the red corner at the moment. tax loss selling will just drop things further... what a predicament.

Expand

Outstanding analysis mate.

Spot on.

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Last 1.8¢		Change 0.000(0.00%)		Mkt cap ! $11.39M

Open	High	Low	Value	Volume
1.8¢	1.8¢	1.8¢	$900	50K

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2	1042548	0.015
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0.023	200000	1
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HMD Chart, page-651

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