OPT (Optos) is a medical retinal imaging company. It takes pictures of your eyes, basically. It can be used in medical diagnosis. The company's uinique selling point is that it can image a much wider range of the retina than competitors. There is even talk that it may help in the diagnosis of Alzheimers - although the company does not reference that in its IMS.
OPTS has a market cap of 149, is trading on a PER of 10.8, has net debt of 16m. and interest cover of 10.5. Its ROE is 23%. Revenues had increased from 66m in 2010 to 91m in 2011. Looks like a really nice GARP company. The share price has been very volatile the last year. I own a very small amount of this stock, and I'm beginning to wish I had bought more.
It released a cracker of an IMS today for Q1FY12, against comparatives of Q1FY11. Revenues up 20%, 11% on a like-for-like basis. In terms of devices, 32 rentals have been de-installed, 59 are new, and there are 425 renewals. The company is aiming to transition customers from P200 to Daytona.
Daytona (their latest and greatest product) is on track to launch in 2012Q1, with design optimisation nearing completion, and manufacturing scale-up underway. Clinical studies commencing in 4 centres to support the market launch.
Showing posts with label opts. Show all posts
Showing posts with label opts. Show all posts
Monday, January 23, 2012
Tuesday, November 22, 2011
Diary: tcg, gmg, icp, pic, opts
TCG - Thomas Cook Group
Thomas Cook down 72% today as of writing on fears of its finances. Readers may recall that I tipped this as "one to avoid" for 2011. Unusually for me, I have been remarkably spot-on for this share. It has fallen 93% YTD, vastly under-performing the market. I am, of course, chuffed to bits at having made a good call.
I can't help thinking that there's actually a viable business tucked in there, if not for the debts. Maybe they'll be a debt-for-equity swap, wiping out current shareholders. I wouldn't say that's a prediction, though, that would be too bold an assertion. I prefer the Delphic Oracle approach - where there's sufficient ambiguity in what I say to be proved right whatever the outcome.
My verdict on this badboy is: avoid. I couldn't rule out a dead cat bounce, of course. No-one can do that. Except for those that can.
A poster on today's Motley Fool article on TCG pretty much sums it up in a nutshell:
GMG - Game Group
Beleagured retailer GMG drops another 15% today. I can't imagine there's too much doubt that we're in the end-game (no pun intended) on this badboy, and now we're just waiting for the inevitable. It's an interesting share, because there's a poster who I highly respect who bought in on this not that long ago. The theory was that it was a cigar butt that was so cheap that there was a statistical likelihood that a more normal valuation will prevail at some point in the future. It's sliding downhill fast, mind, so that looks like an increasing struggle.
ICP - Intermediate Capital
ICP up nearly 10% today. I own this pup, so that's the kind of thing I like to see. It's on a PER of 6.9, PBV of 0.6. The company announced its results for 6 m/e 30-Sep-2011:
My investment "thesis" (not sure I like that term) is that the stock is cheap, the management have outlined where they believe growth will come from, and I believe them. So, a pretty simple idea: cheap, with bags of upside.
PIC - Pace
PIC is having a bit of a rebound the last couple of days. Given how far it's dropped, it's probably about time, too. Couple of points from the FT:
OPTS - Optos - Healthcare equip and services - 225.8p/£161m
Shares up 0.6% on finals. Looking pretty good. Revenues up 35%, profit after tac up 63%, and generally all OK, except that they have increased net debt, and cash flow from operating activities is down.
PER is 11.3, ROE is 23%, gearing is 25%, z score 3.71, so there's nowt to dislike there. EV/EBITDA is 5.3, so you're definitely not overpaying.
OPTS is looking like a pretty interesting GARP idea, admittedly a bit riskier than average, and analysts do expect a 12% dip in earnings for 2012.
Other notes:
Thomas Cook down 72% today as of writing on fears of its finances. Readers may recall that I tipped this as "one to avoid" for 2011. Unusually for me, I have been remarkably spot-on for this share. It has fallen 93% YTD, vastly under-performing the market. I am, of course, chuffed to bits at having made a good call.
I can't help thinking that there's actually a viable business tucked in there, if not for the debts. Maybe they'll be a debt-for-equity swap, wiping out current shareholders. I wouldn't say that's a prediction, though, that would be too bold an assertion. I prefer the Delphic Oracle approach - where there's sufficient ambiguity in what I say to be proved right whatever the outcome.
My verdict on this badboy is: avoid. I couldn't rule out a dead cat bounce, of course. No-one can do that. Except for those that can.
A poster on today's Motley Fool article on TCG pretty much sums it up in a nutshell:
This company has large borrowings and negative net tangible assets. It is in a highly recession-prone industry and also vulnerable to international unrest. IMHO it will not survive.
GMG - Game Group
Beleagured retailer GMG drops another 15% today. I can't imagine there's too much doubt that we're in the end-game (no pun intended) on this badboy, and now we're just waiting for the inevitable. It's an interesting share, because there's a poster who I highly respect who bought in on this not that long ago. The theory was that it was a cigar butt that was so cheap that there was a statistical likelihood that a more normal valuation will prevail at some point in the future. It's sliding downhill fast, mind, so that looks like an increasing struggle.
ICP - Intermediate Capital
ICP up nearly 10% today. I own this pup, so that's the kind of thing I like to see. It's on a PER of 6.9, PBV of 0.6. The company announced its results for 6 m/e 30-Sep-2011:
As the majority of traditional lenders continue to retrench from the credit market, we also see considerable opportunities emerging to acquire debt at attractive discounts in a distressed market, to provide finance to existing buyouts to restructure their overgeared balance sheet and to offer reliable financing solutions for new transactions, thereby delivering high returns to our institutional investors. The progress made on fundraising in a difficult environment is also a testament to our fund management franchiseI wont bore you with the numbers they reported, they look OK, nothing noteworthy. I have to admit I'm a little perplexed as to work out why the market upped the shares 10%. The results seemed fairly predictable to me. This kinda reminds me of what I saw with RWD earlier this year - shares marked up strongly on results that contained no surprises.
My investment "thesis" (not sure I like that term) is that the stock is cheap, the management have outlined where they believe growth will come from, and I believe them. So, a pretty simple idea: cheap, with bags of upside.
PIC - Pace
PIC is having a bit of a rebound the last couple of days. Given how far it's dropped, it's probably about time, too. Couple of points from the FT:
Exane forecast Pace’s problems to erode its cash pile to just $35m by the end of the year, though it said concerns over the balance sheet were misplaced. “We believe Pace should be able to accommodate any bump in the road by factoring part of its circa $400m of receivables,” it said. Separately, Pace was facing relegation to the small-caps in next month’s FTSE review.I can resist including the following quip from some wag on the bulletin boards:
I can´t see how this stock will correlate with the wider market from the point is has reached. More likely an Asian weather index!Amen to that!
OPTS - Optos - Healthcare equip and services - 225.8p/£161m
Shares up 0.6% on finals. Looking pretty good. Revenues up 35%, profit after tac up 63%, and generally all OK, except that they have increased net debt, and cash flow from operating activities is down.
PER is 11.3, ROE is 23%, gearing is 25%, z score 3.71, so there's nowt to dislike there. EV/EBITDA is 5.3, so you're definitely not overpaying.
OPTS is looking like a pretty interesting GARP idea, admittedly a bit riskier than average, and analysts do expect a 12% dip in earnings for 2012.
Other notes:
- unveiling Daytona, the next generation desktop retinal device, in 2012Q1
- Optos' core devices produce ultra widefield, high resolution digital images (optomaps) of approx. 82% of the retina, something no other device is capable of doing in any one image
- potential to offer opthamologists and optometrists the most powerful tools for disease diagnosis and management.
- expanded salesforce
- moving into new territories in Europe and Australi
- newly launched device 200Tx addresses important export markets such as Japan
Monday, November 14, 2011
Diary: aff, kio, opts
First two stocks listed below are "buy" recommendations by Faraday Research on a video dated 10-Nov-2011.
AFF - Afferro Mining - Industrial Metals and Mining - 47.70p/£49.6m
Notes from video: west africa. contrary to popular belief, there is a lot of iron ore there, with big deposits being found (not just by aff). china has a big deposit in cameroon. they're building a 530km rail track to the coast. it runs 30km from aff's deposit in cameroon, so it's an easy way to piggyback when it's built. short-term catalysts expected: plenty of cash, mining feasibility studies in cameroon expected soon, potential expansion of 40% ownership of a mine in liberia.
I currently hold this stock - it's been a bumpy ride so far, I'll tell you that for nowt.
KIO - Kiotech Intl - Pharma and biotech - 88.5p/£16.5m
Notes from video: makes fish feed but going into other animal products. half of world's fish in china. china love carp. kio have discovered a food additive that naturally boosts a fish's appetite, so they grow faster. designed forfarmed fish, clearly. kio is just breaking into the market. it's a play on global food demand. fish from sea is unsustainable.
Newsflow
11-Nov-2011 Will change its name to Anpario on 01-Dec-2011, EPIC ANP. This will ensure a clear distinction between the name of the holding company and those of the trading companies and product brands.
12-Apr-2011 Dividend up 74%
Financials
KIO is on a PER of 10.7, and has net cash of £3.4m. Analysts estimate 2011 EPS growth of 21%, and for a further 15% growth in 2012. Looks good. Director shareholdings are minimal, which is off-putting.
OPTS - Optos - Health care equip and services - 222.80p/£158.9m
This first came to my attention on at thread by AdamB1978 at Motley Fool. It was 186p at the time he suggested it, so it's since gone up in value by about 20%. He was the one who suggested CTN - so he's got my ear.
Background
It makes retinal imaging devices that create optomap images. The optomap is the only image that provides an ultra-wide 82% view of the retina. A simple optomap scan is an important tool for the screening, early detection and diagnosis of eye problems such as retinal detachment, glaucoma, cataracts, retinal holes/retinal tears and age-related macular degeneration. It can also indicate evidence of non-eye diseases such as diabetes, hypertension and certain cancers. Many of these conditions can be seen in the periphery of the retina as well as in the central pole which is why widefield imaging is so important. Optos believes that its technology provides an unequalled combination of widefield retinal imaging, speed and convenience for both the practitioner and patient.
There are a lot of IP barriers to entry. Their long-term target is to grow by 20%pa. They are entering new markets and launching new products so there should be plenty of growth left. Gross margins have been 60%-67% over the past several years. WBIT has grown from $4.4m in 2005 to $18.1m in 2010.
Somewhat capital intensive, and the majority of their sales are in US. Their international sales are growing quicker.
Newsflow has been uniformly positive, and you get a sense of a company going somewhere.
BBS
What the bulletin boards have been saying
The company are looking at using the retinal maps as a marker for Alzheimer's disease. If this proved to be the case then the market for their products becomes vast. Unlikley to be a single test for AD but part of various other tests. The disease is associated with plaques in the brain. It is possible the vascular changes could be picked up from the Optimap that may indicate the onset of the disease . Might not be the case but if it was you could have one in every Doctors surgery.
I managed to speak at the weekend with a doctor I know who has had significant involvement in retinal imaging. His view was that Optos' wide angle views of the retina were incredibly clever (conventional camera based imaging cannot achieve those angles because the pupil is too narrow) but of limited use until the resolution can be improved. The resolution of the laser imaging is years behind that of conventional imaging, which is important because laser imaging's current resolution levels are too low for the majority of promising medical applications for retinal imaging, in contrast to conventional imaging. However, if Optos can improve the resolution of their imaging then it would be a big breakthrough - the speed and, most importantly, the wide angle, would set this technology apart from conventional retinal screening. The doctor is convinced that retinal imaging has a huge amount of potential for diagnosing conditions - one area of medical industry where the hype is in his view justified as the retina is a unique window on the state of the body (he conceded that not all doctors share his view to the same degree). The more of the retina that can be imaged, the better. The million dollar question - how likely is it that Optos will be able to improve the resolution in a commercially viable way - "it's a punt". There is no certainty, or even likelihood, that Optos will be able to develop a successful laser imaging solution which has sufficient resolution for the many likely future applications, or even for many of retinal imaging's current applications. The "punt" comment relates to the possibility of technological breakthrough, not to investment in the company, about which the good doc said he didn't know enough to have an opinion.
Newsflow
02-Nov-2011 received CE mark clearance for its Daytona device. Remains on track to commence first product sales of its next generation, desk-top imaging device, Daytona, in the first calendar quarter of 2012 in its key markets of the US and Europe.
04-May-2011 Study revealed a highly significant association between AD (Alzheimer's Disease) and peripheral small hard drusen formation, suggesting that monitoring the peripheral part of the retina might become a valuable tool in the detection and monitoring of the progression of AD. Further work is being planned to investigate whether peripheral small hard drusen can be shown to act as a surrogate marker for plaque development in the central nervous system.
06-May-2010 In two clinical studies, results show that image-assisted examination using the Optos ultra-wide field P200C had a greater capability to detect retinal lesions compared to traditional ophthalmoscopy by approximately 30%. The study confirmed that there are wide ranging pathological retinal changes in the periphery even in those who have no central pathologies.
Financials
Beta 0.34. One director owns £11.4m of shares, which is pretty respectable. None of the other director holdings is significant. There have been no director deals in the last year.
Trades at a PER if 13.4, gearing 37%, interest cover 3.65, net debt 18.7m, and z-score of 3.14. These figures look fine. PFCF 11.3, which is very good for a growth company.
AFF - Afferro Mining - Industrial Metals and Mining - 47.70p/£49.6m
Notes from video: west africa. contrary to popular belief, there is a lot of iron ore there, with big deposits being found (not just by aff). china has a big deposit in cameroon. they're building a 530km rail track to the coast. it runs 30km from aff's deposit in cameroon, so it's an easy way to piggyback when it's built. short-term catalysts expected: plenty of cash, mining feasibility studies in cameroon expected soon, potential expansion of 40% ownership of a mine in liberia.
I currently hold this stock - it's been a bumpy ride so far, I'll tell you that for nowt.
KIO - Kiotech Intl - Pharma and biotech - 88.5p/£16.5m
Notes from video: makes fish feed but going into other animal products. half of world's fish in china. china love carp. kio have discovered a food additive that naturally boosts a fish's appetite, so they grow faster. designed forfarmed fish, clearly. kio is just breaking into the market. it's a play on global food demand. fish from sea is unsustainable.
Newsflow
11-Nov-2011 Will change its name to Anpario on 01-Dec-2011, EPIC ANP. This will ensure a clear distinction between the name of the holding company and those of the trading companies and product brands.
12-Apr-2011 Dividend up 74%
Financials
KIO is on a PER of 10.7, and has net cash of £3.4m. Analysts estimate 2011 EPS growth of 21%, and for a further 15% growth in 2012. Looks good. Director shareholdings are minimal, which is off-putting.
OPTS - Optos - Health care equip and services - 222.80p/£158.9m
This first came to my attention on at thread by AdamB1978 at Motley Fool. It was 186p at the time he suggested it, so it's since gone up in value by about 20%. He was the one who suggested CTN - so he's got my ear.
Background
It makes retinal imaging devices that create optomap images. The optomap is the only image that provides an ultra-wide 82% view of the retina. A simple optomap scan is an important tool for the screening, early detection and diagnosis of eye problems such as retinal detachment, glaucoma, cataracts, retinal holes/retinal tears and age-related macular degeneration. It can also indicate evidence of non-eye diseases such as diabetes, hypertension and certain cancers. Many of these conditions can be seen in the periphery of the retina as well as in the central pole which is why widefield imaging is so important. Optos believes that its technology provides an unequalled combination of widefield retinal imaging, speed and convenience for both the practitioner and patient.
There are a lot of IP barriers to entry. Their long-term target is to grow by 20%pa. They are entering new markets and launching new products so there should be plenty of growth left. Gross margins have been 60%-67% over the past several years. WBIT has grown from $4.4m in 2005 to $18.1m in 2010.
Somewhat capital intensive, and the majority of their sales are in US. Their international sales are growing quicker.
Newsflow has been uniformly positive, and you get a sense of a company going somewhere.
BBS
What the bulletin boards have been saying
The company are looking at using the retinal maps as a marker for Alzheimer's disease. If this proved to be the case then the market for their products becomes vast. Unlikley to be a single test for AD but part of various other tests. The disease is associated with plaques in the brain. It is possible the vascular changes could be picked up from the Optimap that may indicate the onset of the disease . Might not be the case but if it was you could have one in every Doctors surgery.
I managed to speak at the weekend with a doctor I know who has had significant involvement in retinal imaging. His view was that Optos' wide angle views of the retina were incredibly clever (conventional camera based imaging cannot achieve those angles because the pupil is too narrow) but of limited use until the resolution can be improved. The resolution of the laser imaging is years behind that of conventional imaging, which is important because laser imaging's current resolution levels are too low for the majority of promising medical applications for retinal imaging, in contrast to conventional imaging. However, if Optos can improve the resolution of their imaging then it would be a big breakthrough - the speed and, most importantly, the wide angle, would set this technology apart from conventional retinal screening. The doctor is convinced that retinal imaging has a huge amount of potential for diagnosing conditions - one area of medical industry where the hype is in his view justified as the retina is a unique window on the state of the body (he conceded that not all doctors share his view to the same degree). The more of the retina that can be imaged, the better. The million dollar question - how likely is it that Optos will be able to improve the resolution in a commercially viable way - "it's a punt". There is no certainty, or even likelihood, that Optos will be able to develop a successful laser imaging solution which has sufficient resolution for the many likely future applications, or even for many of retinal imaging's current applications. The "punt" comment relates to the possibility of technological breakthrough, not to investment in the company, about which the good doc said he didn't know enough to have an opinion.
Newsflow
02-Nov-2011 received CE mark clearance for its Daytona device. Remains on track to commence first product sales of its next generation, desk-top imaging device, Daytona, in the first calendar quarter of 2012 in its key markets of the US and Europe.
04-May-2011 Study revealed a highly significant association between AD (Alzheimer's Disease) and peripheral small hard drusen formation, suggesting that monitoring the peripheral part of the retina might become a valuable tool in the detection and monitoring of the progression of AD. Further work is being planned to investigate whether peripheral small hard drusen can be shown to act as a surrogate marker for plaque development in the central nervous system.
06-May-2010 In two clinical studies, results show that image-assisted examination using the Optos ultra-wide field P200C had a greater capability to detect retinal lesions compared to traditional ophthalmoscopy by approximately 30%. The study confirmed that there are wide ranging pathological retinal changes in the periphery even in those who have no central pathologies.
Financials
Beta 0.34. One director owns £11.4m of shares, which is pretty respectable. None of the other director holdings is significant. There have been no director deals in the last year.
Trades at a PER if 13.4, gearing 37%, interest cover 3.65, net debt 18.7m, and z-score of 3.14. These figures look fine. PFCF 11.3, which is very good for a growth company.
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