will share about reasons to own ADO stocks. the first few are from my insight into researching this coy, while there will be further reasons from the broker report.
1. strong cash position $2.3mil = ADO will not need to dilute shareholders value for raising capital ( the technology is already there, we have enough money to last us till 2012) -> seriously how many microcaps can say this alone.
2. Director's indicted that ADO to reach cash flow positive by mid 2011.
3. technology which is cheaper and more importantly (as indicated from most recent qtrly) it saves ALOT of time : quote: scientist from the IVD companies were impressed with the speed and simplicity of ADO's process. One party quotes, "i have been able to do work in the past 2 days that would normally take me a month."
no, seriously! 2 days to do a month's work!
4. Dr Cumming (MD ADO) proven tract record. since appointment, 2010 has so far been a great year for ADO. He's going to pull the strings to Roche imo. and i'm just waiting to hear that ann.
5. increased coverage to start. well we saw the article ran by AFR last wkend. prolly more to come.
6. at current sp, market is valuing to see ADO get 2-3mil per annum. we have deals with Bang and Merck with 5 products out in the market. i would really think that ADO sales will do better than that 3mil per annum. (bearing in mind the target from ADO is 60-180 mil (for the IVD side only).
7. Merck's agreement = confidence in ADO's technology (it's like a oil minor being in bed with WPL or a minor miner with RIO?)
got this from the broker's report. have a read at them (http://www.bio-layer.com/pdf/Broker%20Coverage%20from%20Southern%20Cross%20Equities.pdf)
8 reasons to own ADO stocks.
1) Anteo?s technology is commercially attractive to potential licensees in the diagnostic testing space. The Anteo Surface Technology, and the first product from that technology, called Mix&Go, can demonstrably improve the economics of diagnostic testing products through improved assay performance and reliability, and reduced cost and ease of manufacturing. Consequently we expect many large companies in the diagnostic testing space will show licensing interest.
2) Anteo?s technology can help create new diagnostics, faster. Mix&Go has potential to create new diagnostics faster than existing methods. We therefore see its increased use by makers of novel diagnostics as a way of lowering development times.
3) Potential markets are large and growing. Around US$7-8bn a year gets spent in the global immunoassay consumables market, of which 70% represents the competitive laboratory market and the remainder point-of- care. We understand that typical growth rates in these markets are 5-6% pa.
4) A near-term payoff in diagnostics and research. With Mix&Go development and validation now completed, the technology has reached the licensing stage, with a number of interested parties having signed MTAs and NDAs. We see potential multiple licensing deals over the course of 2010 which would yield royalty revenue to Anteo.
5) The first significant diagnostics deal has been done. A January 2010 licensing deal with an American company called Bangs Laboratories, which supplies diagnostics test components to the research market, has started the process of putting Mix&Go-treated products out to the marketplace.
6) There are considerable ?blue sky? applications of the Anteo Surface Technology. Anteo has identified a number of other biological and non- biological applications for its technology. We see potential for the company to garner licensing deals in these presently ?non-core? areas.
7) Management is capable. Dr Geoff Cumming, Anteo?s CEO since early 2009, has many years of experience in developing and selling diagnostic testing products, and he has done a good job of focusing Anteo on early stage revenue opportunities. We believe Cumming and his colleagues have the commercial smarts to license Anteo?s technology on favourable terms.
8) The current share price is undervaluing the upside potential. We value ADO at $0.13 per share base case and $0.24 optimistic case using a high- discount-rate DCF valuation. Our target price of $0.13 sits at our base case valuation. There is potential for the market to rerate Anteo as licensing deals begin to emerge and early revenue is generated from Bangs and other deals.
i hope this post allows some to make an assessment on the potential of ADO as well as to promote discussion about the coy. hope to hear from all. plus whats the tots on next agreement ann? before the AGM anyone? regards.
ADO Price at posting:
4.8¢ Sentiment: Buy Disclosure: Held
(20min delay)