This is a special message for all of those investors who have done their shirts in the market over the last 12 months and are desperate to rebuild their diminished fortunes.
The message for you guys is: buy a few GBI at current prices (sub 20 cents) and you should do exceptionally well.
Over the course of the next week I am going to take readers of this thread on a journey of discovery to help you understand why I feel so confident that a 10x return is not just possible, but highly likely, if you take a 12-18 months perspective.
The key messages that I will be posting on in detail over the next week are these:
1) HPV testing is a very fast growing market globally, and will continue to be so for many years to come
2) There are a number of companies with a strong strategic need to participate in the HPV testing market, which has led to very strong corporate interest in smaller companies with credible HPV tests (deal sizes in last 18 months range from US$345 million for an entirely uncommercialised test through to US$1.6 billion for the industry pioneer in HPV Testing). It would be a surprise if GBI did not start to attract corporate interest as its profile builds over the next 12 months
3) GBI has developed an HPV test that stacks up very well against the competition, with European and Australian approvals for the product expected in 1H2009. However, commercial deals with Gribbles and Sonic, and the fact that the test is already in use at Gribbles, provide very strong commercial validation even before approvals are recieved.
4) Until now, GBI has done relatively little to promote its product internationally & to make sure that it is on the radar of international customers (and also possible strategic partners or acquirers). As the company comes closer to full commercialisation this is all starting to change.
5) GBI performed poorly in its first few months as a listed entity as it had a rag-tag shareholder base of medium-net-worth investors who had come into the company over the last 7 years, and many of whom did not understand the story. However - the fact that the share price has now been steady at 15 - 18 cents for 6 weeks suggests that we have reached the bottom and that the only way is up.
6) Transaction pricing on previous deals suggest that GBI could easily be worth US$100 million in a competitive takeover environment at around the time that CE Mark approval is obtained.
GBI Price at posting:
16.5¢ Sentiment: Buy Disclosure: Held
