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Sbi's day will come its much more than a covid stock fundementals will out eventually.
That is true but they were only doing about £20m in revenue from their 3 other businesses in 2019. Now they are a quality company and provide excellent service and they only started Covid testing in May 2020. They did £51m in revenue in 2020 in total and £37m in the first 6 months of 2021 and it looks as if their Covid testing is significantly more in the second half of 2021. They said in their half year report that they were doing 14,000 covid pcr tests per day in September and now he is saying they are doing 20k per day in October so my previous average estimates are probably way down on current revenues because that is £500k per day in Sept and £800k per day in October and with this third wave it looks like the NHS demand they have is not decreasing any time soon. So lets say they have on average £500k per day Covid revenue in the second half of 2021 that would be £90m in covid revenue in the second half of the year and £10m other revenue, - full year revenue of around £140 to £150m about £55m to £60m in full year Ebitda 2021. take off tax etc that's about another £40m in the bank so they end up with around £60m in the bank at the end of the year and probably continuing high numbers of testing well into 2022. At 130p share price (£100m market cap) that is essentially giving no value to the covid/ID business into the future and valuing the pathology/refrigeration and NGS business at 2x revenue (about £40m). it's very much a value play but until they post the numbers in January I don't think the share price moves much. Now they are in the process of setting up the lab in San Diego and they were estimating an extra 2000 pcr tests per day from that lab, but they were waiting on final USA approval (?FDA approval) to get that lab up and running which has been in the pipeline for a long time. So who knows. Certainly, if I had £100m in my back pocket, it would seem like an absolute bargain. You'd basically get your money back in revenue back in less than a year with a 40% Ebitda and get the whole non covid business thrown in.
apologies but having looked at their Sept statement Ebitda was only just over 30% in the first half of the year ( I had previously read that covid ebitda was about 40%) so this may be lower because maybe the NHS tariff is less than private price. With that we could adjust full year EBITDA at £150m revenue to £45m. That would give them an EV to Ebidta ratio of around around 2.2 and about £50 m in the bank at the end of the year.
Rather than looking for aquisisions .Could well be on the radar itself with all that cash sloshing around.
By whom though? Who would be in the business of buying lab services companies?
Somethings afoot price edging up from lows SBI recruiting methinks they must have takeover target in sight.