Member Info for Cubed

A US federal judge has just extended the injunction against NIH funding cuts.

This perceived threat was discussed on the fY results call on Tuesday. Roche’s product is a short read sequencer and will be in direct competition with illumina. ONT is a long read sequencer and the only Nanopore based sequencer on the market. It’s not perceived to be a threat at launch next year.

As he buys more (he can buy another ~15% of the company yet) the available free float is getting more tightly controlled too. Any hint of good news would lead more pronounced moves in the share price as the stock simply won’t be there to meet demand and/or significant institutional buying, if that time comes.

Numbers next Tuesday, should be a key catalyst day, up or down.

JPMorgan (overweight) 

It doesn’t seem like Roche will be a direct competitor initially, given the company is focusing on short-read applications, analyst James Gordon writes in a note

There may be increased competition for Oxford Nanopore in the “ultra-short read” sequencing market

RBC (outperform) 

Roche’s technology isn’t a competitive threat to Oxford Nanopore’s products, “except where sample-to-answer speed is the predominant advantage within clinical sequencing,” analyst Charles Weston writes in a note

Even so, the speed of Roche’s system is impressive, and “significantly faster than other short-read instruments”

Stifel (hold) 

The current lack of long-read capabilities for Roche’s platform means Oxford Nanopore retains this unique aspect, as well as being “the only platform to read native DNA,” analyst James Orsborne writes in a note

Even so, there could be a hit to sentiment in the near term

Pricing/cost is the “key unknown”

It doesnt launch until next year and doesn't do long read sequencing, the area of the market ONT seems to be dominating. Brokers seem very sanguine about its threat to ONT specifically.

As Trump unveiled his $0.5 trillion AI expenditure plan last night, the first man to come on stage and talk about AI and give an example of how AI can help the US was Larry Ellison. He spoke about AI in healthcare and testing specifically to see what's wrong with people. Its now pretty clear why he has his stake in ONT via the Ellison Institute of Technology. I would expect ONT to play a major role in due course given their higher quality tech versus the exiting sequencing incumbents like Illumina. Remember ONT already has a JV with Nvidia also.

The shorts (2.5% of the free float) are being squeeeeeezed!

Somebody didn’t do their homework, is my guess.

If the pending US administration wishes to clean their health care sector up, then the likes of ONT will be just one of the necessary tools needed given the richness of and insight of their tech.

Systematica are a pure quant driven shop. It's very unlikely they'll be conducting any qualitative assessment (likelihood of M&A etc) on this company. Based purely on fundamental quant, the company is an obvious target; still loss making (for the next 2 years at least), high multiple in a rising rate environment. Such companies tend to do poorly in the current environment. They're probably short this company against a profit generative/lower multiple company.

ONT Have today announced that NHS England are rolling out their tech across 30 hospitals nationwide.

Berenberg have just re-iterated their 12 month price target of £2.82 on the stock.

One has to wonder why Larry Ellison, the founder of Oracle and one of the world’s richest men, is buying an increasing stake in this company.

It expired yesterday . The same day as the ipo.

I dont think there's a huge amount of free float left. The top 10 share holders hold ~60% of the free float and many have just bought in. Hardly any volume on friday moved the price 5%. Anybody wishing to take a decent stake in this via the open the market is going to drive the price in a rather pronounced fashion.

The Chinese steal everything. I hope ONT take them to the cleaners in the courts.

Https://kvgo.com/gs/oxford-nanopore-technologues-plc-sept-2024

Https://x.com/OptimumComms/status/1823307832281719224

Great thesis on the company from Novo...

Unlikely any bidder would step in at this stage whilst the company is still loss making. For the acquirer, that would destroy their own ROIC stats for at least the next 2 years.