Eco Animal Share Price (EAH)

Volume today, to my surprise, was not comparable with previously heavy volume days, in the previous month. So the relatively light volume and sizeable rise, looks like the market makers, marking up the sp. Maybe the volume at the end of day, will dispel any doubt about whether the rally, has healthy volume support. DYOR.

In a trading update for the twelve months to end 31 March 2024, ECO Animal Health reports that revenue should be close to £90m; this compares to the March trading update outlook of £88.7m. The Group expects that FY24 (adj.) EBITDA should be in line with the current market consensus expectation of £7.8m (ED estimate was £7.6m). The year-end cash position was approximately £22.0m; we estimated £20.1m.

The Group also noted EBITDA delivery against the background of maintained investment in R&D, the wellspring of future product and revenue streams. Our FY24 estimates include provision for £4.2m of R&D spend for the year.

Our Fair Value range is 137p-146p, reflecting the potential in the pipeline of products under development, which is backed by the rigour of EAH’s development-to-distribution process.

New research note here: https://www.equitydevelopment.co.uk/research/fy24-ahead-of-expectations

Could get a holding notification soon given the volume of trades going through today !!

Eco Animal Health has announced the disposal of its treatment for equine parasitic infections, ECOmectin® Horsepaste, to its long-term Italian manufacturing partner, ACME Drugs S.r.l. ACME will acquire all ECOmectin® Horsepaste intellectual property, manufacturing and inventory, distribution and marketing.

Our Fair Value range remains 137p-146p which contrasts with the current share price, suggesting that the potential contribution to earnings from the product development pipeline deserves far closer attention.

https://www.equitydevelopment.co.uk/research/disposal-of-non-core-equine-treatment-operation-for-1.3m

For the year ended 31 March 2024, Eco Animal Health reports progress in both the second half and Q4, underpinned by demand for the Group’s proprietary Aivlosin® antibacterial treatment for gastrointestinal and respiratory diseases in pigs and poultry. The Group reports sustained demand for Aivlosin® across the territories it targets, which we note are worldwide: China, Japan and SE Asia, the Americas and Europe. The Group expects FY24 revenue to be in line with a market consensus estimate of £88.7m.

Following the November Capital Markets event we reviewed the contribution to valuation of the product development pipeline, particularly in light of the strong track record established by Aivlosin® . Our resulting Fair Value range was 137p - 146p. This contrasts with the current share price, and suggests that the potential contribution to earnings of the product development pipeline deserves far closer attention.

Link to research note: https://www.equitydevelopment.co.uk/research/sustained-demand-and-continuing-progress