All good mate, definitely lots of near term catalysts that the market is definitely NOT yet pricing in. Here is what I am expecting will help the market realise the potential here:
FY23 Financials (July/August 2023): the market will be looking for signs of iTrack Advance adoption. Whilst FY23 results will not incorporate sales due to the recent FDA approval of iTrack Advance, they should provide an indication of the number of new accounts, as well as guidance for FY24. This depends on how visible FY24 results are, and given the high anticipated growth it may not be as visible as FY23 results were when they provided guidance in the FY22 report, so we can't expect to receive guidance yet. Either way keen to see it but not expecting too much here this early.
FY24 Half Year Results and AGM(December 2023): the FY24 half year results in December of this year will fully incorporate the launch of iTrack Advance, and should reveal the first sign of significant uptake. By December we should easily have a high number of NEW doctors on board, so these results will most certainly be highly anticipated. Given that at a 2x multiple to the revenue of the original device, the market is (for whatever reason) not anticipating any growth here so any positive growth figure will be bullish at current prices. I expect high double or even triple digit growth. Results will coincide with the AGM which should provide further light on the effectiveness of launch activities, as well as other information relating to the rest of business (e.g. 2RT)
CATALYST Study (end of 2023): clinical trial results reinforcing the efficacy and safety of iTrack Advance
MAGIC Study (end of 2024): clinical trial comparing iTrack Advance to Omni. Will be a major catalyst as it should reveal in very clear numbers that iTrack Advance is vastly superior relative to the Omni device, likely resulting in a significant increase in sales for FY25 (thus, we should see sustained sales momentum even after the initial launch).
2RT Partnership (today to December 2023): the 2RT partnership will be a true "rerate" catalyst event for Nova Eye Medical, and I could easily see a single day triple digit appreciation following this event. The market has clearly not ascribed a value to 2RT, evident in the current valuation ONLY incorporating the original iTrack device at a 2x revenue multiple. Therefore, the partnership (which is an equity deal) will give 2RT a clear valuation, which will likely be reflected in a company valuation at 2-6x iTrack revenue + the valuation ascribed to 2RT via the partnership, meaning we could easily be looking at a near term share price target in the dollars. The timing of the partnership is completely unknown, though I suspect it is near term. They are progressing discussions with multiple partners and recently announced a change in sales strategy for 2RT, likely the result of partner discussions. I think we could see a partnership before end of July, but I said December to be cautious. After all, they are focused on the iTrack Advance launch, not so much 2RT at the moment.
2RT Clinical Trial Progress (2023-2025): we should be receiving regular updates on the various clinical trials being undertaken for 2RT which should all continue to derisk this business segment. Enrolment for the pivotal clinical trials will likely begin in June/July 2023, and trials should commence outside of the USA by the end of this year. LIANA results should be received mid 2024 and from there we should be getting regular updates on both protocol A and B studies.
2RT European Sales (unknown): as mentioned, there has been a recent change to the 2RT sales strategy and it looks like European marketing of 2RT will be recommenced much earlier than anticipated. This likely indicates that they are in discussions with a large big pharma company which has the necessary infrastructure to market 2RT in countries where it is approved. 2RT has proved to be highly profitable even when very few units were sold, so we could be looking at enormous profitability here even if sales are limited to Europe until FDA approval is achieved. Will be interesting to see how this goes.
R&D Pipeline (unknown): as we have recently discovered, there is an additional R&D pipeline which the company has kept very secretive (hence why we only just discovered this). The company has confirmed they have an active program, so we could be potentially looking at a major catalyst depending on what this "secretive" R&D is. I assume we could expect an announcement sometime in FY24 relating to this, but can't be sure.
Those would be some of the major near-term catalysts. However, there are certainly many we most likely cannot predict yet. After all, we only just discovered that there is this secretive R&D pipeline, so who knows how much else there is yet to be discovered with this company. Financials should continue each half year to push the share price up. We will likely get TO bids (given how much M&A has been happening in the space recently), new substantial holders and increased broker coverage as we increase in price. I expect the company to become profitable on iTrack Advance by FY26 as well which could be a major catalyst if the market is not yet expecting it. Gross margins are high and customers are loyal and recurring so they should be able to significantly cut marketing spend which will result in high net margins down the track (assuming a far higher sales base than it is today). As iTrack Advance revenue growth begins to slow to low double digit growth (in line with the industry average), 2RT should be entering the market to give a second big boost to sales, through to 2030 and beyond. Definitely looking at long term high growth here imo, we just need the market to wake up now
EYE Price at posting:
24.0¢ Sentiment: Buy Disclosure: Held
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