Firstly, I don't want you to take my first comment the wrong way, i don't know your background and you don't know mine so I don't want to come across in the wrong light. Also, I feel much more comfortable with technical analysis than fundamental analysis. This is a new beast to me - one that I am far from perfecting.
I find the research on this forum quite insightful, it allows us all to develop an understanding of what is happening with OBJ, what our competitors are doing as well as our partners. I must admit too, that there are times when I feel some of the research misses the mark.
When looking at a prospective company, there are several things that I look for. OBJ hits the mark for several of them and misses for others.
1) Solid cash position - Personally I prefer a company with increasing revenue & increasing profit. OBJ is obviously not this, they do not make money. However, they do have enough cash in the bank to maintain the company for several years. They have also extended the exercise date on their options on two occasions. Clearly they do not think that cashflow is an issue.
2) Multiple Products - In order to provide sustainable income it is essential for a company to have more than one product. This helps to reduce the chance that competition will erode any potential revenue stream. OBJ have three core technologies. However, our technologies can also be used on multiple applications. Our partners have also requested exclusivity to use our technologies and this, if they do sign a licensing deal, will increase the royalty that is received. This could, subject to conditions being met by both parties, result in an upfront payment.
3)IP - In order to protect revenue streams (and in this case to build revenue) a company has to protect its intellectual property. JTA has kindly been keeping an eye on this one for us.
4) Directors have a vested interest in the success of a company - I prefer the directors of the company to be accumulating shares, particularly if the share price has been in decline. OBJ directors haven't accumulated any shares for some time, though they have organised performance options that can be exercised once the directors have met the three conditions as per our last AGM. This shows us two things, that the directors have a vested interest in developing OBJ further and a potential timeline of events.
5) Useful Innovation - Cutting edge technology is one thing, but if we want to make money then the technology has to have commercial appeal. This is confirmed that we are dealing with some of the largest companies in the world, GSK and P & G. The potential revenue that can be generated by these companies, as you have said, would re-rate the company.
These are a couple of things I look for, amongst other indicators, such as large top 20 shareholding (OBJ doesn't have this when compared to other companies). OBJ, as previously said, don't hit all of the marks when it comes to my criteria. For me, the marks that it does it are hit in a big way.
That's my take on it, much of this has been said before so it isn't anything new to most. Hot Copper is a useful tool, especially because of some of the posters that we have on this forum but I can also see why you are concerned that some people don't do their own due diligence on this stock.
Cheers & good luck to all.
OBJ Price at posting:
1.6¢ Sentiment: Hold Disclosure: Held
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