Hey
@rae915
Yep. Volume is light, and in spite of the macro, the sp is holding up pretty well.
However, I'm not so sure that $"
890 000 a quarter indicates almost maximum production and sales," as the sales and marketing for Striate have only just begun. ACE barely started marketing let alone distribution in mid to late Sept, so we're yet to see anything meaningful from them and probably won't see anything decent revenue wise until they ramp up sales in a few quarters, production restraints notwithstanding.
Now while the TAM for dental is huge, coming in just above USD$1B, its obvious that Orthocell won't and can't capture all of that and, hypothetically, even if Henry Schein (which from here forth I'll refer to as the BH/ACE deal), does somehow acquire the total addressable market (my assumption being that Orthocell only nabs about 20% margins - a guestimate only), that equates to $200,000,000 a year.
Obviously, that's ridiculous, but it's the max achievable. So now let's dispel all logical common sense and assume that HS captures just 1% of the TAM, which would equate to $20m/year for OCC. Theoretically.
It's still widely speculative, widely ridiculous, but not wholly unachievable. (Even though as I type, it seems highly unlikely).
So, like you and
@Jayze87 and I have now postulated, how do they ramp up?
Their facility is still too small, and so is their current building.
Still, I don't doubt Paul is aware of this and will already be looking at ways to address this issue. Let's also remember that Striate+ was always the lessor/beginning of the company's product suite; the initial burst of revenue to propel their more lucrative revenue generating assets.
In time, I'll call Paul again and ask him about this (unless someone else on here wants to give it a crack), but for now, I'm happy to buy on weakness and doubt.
I am happy to hear others' thoughts on the matter, and perhaps
@bedger can input his position as well.
Looks like more weakness/pain coming on Monday too, so GLTAH.
(20min delay)