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More good news for SBI - on Friday Oxford Nanopore won a £4m LamPORE Mobile Laboratories contract from the Depatment of Health, for Mobile Laboratories fitted out with LamPORE equipment to further enable mass testing.
This "will reduce transit time for samples to travel to a static lab location therefore reducing test turnaround time".
Https://bidstats.uk/tenders/2021/W01/742523231
Per last month's agreement, the LamPORE tests are being sent to SBI for assessment "at SourceBio's state-of-the-art ISO15189 accredited laboratory facility in Nottingham to offer a large-scale COVID-19 diagnostic testing service".
Https://www.prnewswire.co.uk/news-releases/oxford-nanopore-and-sourcebio-announce-commercial-partnership-for-uk-covid-19-testing-service-873764622.html
PS. And it's up over 17% today, so you're right about the following!
Just to say about Griffiths, if you're following him: today there was an RNS from Bigblu Broadband (BBB), he's just come in there straight to 5.87% of a £54m mcap company. Encouraging for me, since I bought in there end December :)
SBI are offering home testing COVID-19 tests FYI, i.e Government approved 'Test to Release' Covid-19 Antigen RT-PCR tests .
You can reduce your self isolation time when arriving back from your holiday or business trip. Order online - only a 24 hour turnaround time:
Https://coviduk.sourcebioscience.com/?utm_source=linkedin&utm_medium=_&utm_term=source+bioscience&utm_content=e5c5bc23-d4bf-4dd8-92b0-50cd9e625cdb&utm_campaign=default+post
That was on the 30/12. Only notified today. He could have sold em since them !!! Remember this is the stock market. We will always be behind the curve
He's been buying and has increased his stake to 4.22%, or 3.13m shares.
He has quite the following in the City, so we may be in for more good times ahead:
Https://www.investegate.co.uk/sourcebio-intl-plc--sbi-/rns/holding-s--in-company/202101071031599200K/
I was in at 174 pre-Christmas and went through the slight dip. Wasn't too concerned by that as I invested for the long term. I am pleased to see the steady, sustained rise here. A much better indicator of a quality stock than sharper but shortlived spikes that quickly reverse.
Nice start again this morning, up another 2.5% already....
A very nice couple of days
Cheers Rivaldo. I've noticed a few common stocks that we both own + your very useful input / write ups here + stockopedia. Keep up the great posting pal.
Continuing to rise. Buying at 218p and above now.
Good post Scoobydoo321, thanks. Some very good near-term reasons to hold here, in particular the Kantaro test which you mention (EKF are in bed with Kantaro and will benefit nicely - I hold!).
Plenty of Upside still - SP should get an uplift due to :
1. Come Feb - Per Nov 20 RNS
· Public Health England's ("PHE") National Microbiology Framework now expected to be awarded to successful applicants from February 2021 / · Application for National Microbiology Framework has been submitted on the basis of building testing volume capacity above management's earlier expectation of 10,500 tests per day
Blimey 10,500 test a day = 10,500 x £40 x 40% circa profit margins = blo*dy money machine.
2. kantaro kit - antibody testing - if this takes off as I speculate and SBI are appointed as one of the main clinical labs to do the bloodworks - SBI 's earnings will be lifted bigitme.
3. elective surgeries - post pandemic will go ape - particularly the unfortunate cancer patients (SBI specialise in oncological diagnosis) and their own oncologists - they are outsourced work by NHS.
Now up almost 14% today, and buying coming in at 214p now.
Some £50k trades going through at £2.05. Follow the money ?
The 188p offer price has at last moved up nicely, suggesting that the seller who was around yesterday is out of ammo.
£94k
Listening to various scientists professors and medical professionals today I think it fair to say that we are back in the doo doo for a sustained period. SBI will do well from this , I invested today £20k and will leave it be. Shocking day for a lot of people today as their futures are plunged into more uncertainty and angst.
nlondon
PE 13/14 - would be the upper range of a PE ratio for a traditional manufacturing company that is doing pretty well (e.g. CRL)
Avon Rubber - is on PE - 30s
Bioscience / Tech companies are not rated at PE ratio 13/14.
ggplyr
Valuations in bioscience / diagnostic are very high - i.e. PE ratio (forward) are very high.
Why?
Expectations of earnings growth.
So IXI - on top of my head - who does neuroimaging - made PAT circa 1mn FY 2020
Current MV = 48mn
CAGR - 25%
Cash in hand = 8mn
MV without dosh = 40mn
SP = 102p (mid price circa)
EPS = 2p
PE = 51 !!!!!!!!!!!!
I held IXI until it got to its 80s and sold.
ggplyr - best to view directly from the source itself pal
https://kantarobio.com/83772-2/
In short, we, humans do not know how long the vaccine will last for.
for more vulnerable - it could be a few months
for younger - could be longer.
Obviously cost-benefit analysis required by national health dept.
Also, read - https://www.fool.com/amp/earnings/call-transcripts/2020/08/04/bio-techne-corp-tech-q4-2020-earnings-call-transcr/
Hear the excitement of the ceo biotechne w.r.t kantaro. He's like a little kid jumping in the air shouting whoopee. Don't forget Biotechne carry other products besides kantaro. The CEO, who operates in this field obviously thinks this is a winner. (kantaro).
From what i've heard from experts, lateral flow will never be good enough, without a few rapid in succession tests, to beat pcr and even then!It's accuracy rate is about 60%.If sbi can carry on getting revenue in the short-term/medium term from and profit then they will have a good cash reserve to re-invest in research in other areas and buy new non-covid related businesses surely?
I'm not a mathmo *at all* but a cash rich business is a a definite benefit.Somebody on novacyt board said they are trading at a p/e of 30.Not sure if this is correct but surely a p/e of 13/14 is much more reasonable.
I did wonder why it is suddenly moving though.The Daily Mail!
I agree with most your maths. Although tax losses aren't infinite, so your 2m/per year will need tax taken off. I haven't looked at the tax losses but I'd assume they are probably wiped out by tax charge on the 2020 and the expected 2021 pbt if it really does achieve the 70 odd mill of cash. (I'm not sure whether the 70mill is pre or post tax)
So your 27 becomes 34 at a 20 percent tax rate. Is a p/e ratio of 34 in this industry that normal? If so why is it higher than than other industries? I've never followed this industry before.
RE: your point on covid testing required on an ongoing basis on a material basis? Why is this the case? I've had a tetanus jab about every ten years, I've never had a test to see if I need the jab. Why bother?
I'm sure there will be testing in a year or twos time, but it's not going to be anywhere near the current volume.
3rdly - As far as I know, the leading IIors who participated in the IPO - Harwood + Odier have NOT sold any shares post-ipo.
4thly - I keep harping on about this but there is this incestual relationship between RENX, SBI and EKF in respect of the Kantaro covid kit which SBI chairman alluded to in a presentation given a few months back but at the time he did not discuss in detail since the Kantaro kit has NOT been given FDA UEA clearance then. In Nov it was duly given - https://www.hospimedica.com/covid-19/articles/294786039/ekf-launches-one-of-the-first-tests-to-precisely-measure-levels-of-covid-19-neutralizing-antibodies.html
Basically, it's all the Chris Mills, - i.e. Harwood Capital's stable.
So what's this got to do with SBI?
Well Kantaro, at present, IS the defacto standard for quantitative antibody kit - i.e. a kit that measure exactly what levels your antibodies is and whether you need to top up. More info here https://kantarobio.com/category/in-the-news/
Recently (Im speculating) , renalytix (stock nasdaq) which is a JV partner who founded kantaro kit SP has been rising. I reckon it's on the back of the kantaro kit (hospitals in the US using it? - not sure no rns).
If kantaro is used by NHS, EKF is the exclusive distributor and SBI is a likely to be a major beneficiary given the kantaro kit requires a clinical lab which SBI has all the accreditations.
Therefore POST vaccination - us public tend to think that its all lovely jubbly end of story - bye bye covid - but I'd say far from it given that we will need vaccine top ups based on the level of antibodies that we all have (this will differ person to person) - and the kantaro kit - at present is the likeliest candidate (check out the specificity and sensitivty - it's good!) .
Anyways that's my 2 cents.
ggplyr - good points -
1stly - it's a turnaround story with Harwood Capital coming into the picture and changing things around.
2ndly
here is my
back of the fag packet caln
note - "Liberum expects SourceBio to end 2022 with £73 million in the bank"
So say non-covid biz is 2mn PAT by 2022 YE.
Assume their tax losses can be utilised. So PBT = PAT
So trying to strip out the covid biz from the non covid biz to ascertain value for non-covid part
Current MV £128mn
Dosh by 2022 73mn
Current MV less 2022 dosh = 128 - 73 = 55mn
So future MV of non covid biz is 55mn
Im assuming that by 2022 - all covid biz - dead
If PAT FY 2022 - 2mn
PE (f) net of cash - 27.5
That's not that bad for a diagnostic / bioscience co.
Look at market acceptance for IXI / EKF
Any holes in my quickie analysis?
Also the bulk of the valuation comes from one product, testing for covid. While I read in news that the rapid tests aren't as accurate as the tests this company does. Its a big race for a rapid test that is accurate, if this comes in say 3 months time and can be done cheaply then their primary revenue stream dries up pretty fast.