Member Info for HarChris

Not arguing with your methodology Shaun but if anything the numbers appear low: Under the terms of the contract, which is in two phases, Primerdesign will supply its products to the DHSC for up to six months. Phase one has an initial fixed term of 14 weeks with the potential to extend supply by a further 10 weeks. This first phase of the contract will involve the immediate deployment of 300 PCR instruments, related kits and support services with a minimum value of £150 million for the first 14 weeks. Based on this initial period, a further £100 million of revenue could be expected for the subsequent 10 weeks, however volumes can be varied up or down subject to certain notice criteria given by the DHSC.

So for 300 PCR instruments (how many of each not specified) and associated assay kits/tests the revenue generated appears to be just above £10m a week... by your maths you're calculating ~£12m a month per 300 machines.

Action, little pointer for you - the actual share price is irrelevant. The number varies depending on the number of shares in issue so for example two companies might have an identical valuation but one has ten times the number of shares in issue and so the share price is 10 times lower than the other.

Always look at mcap.

These are portable devices, does every care home need one? Could they not be used in rotation and have specific visitor days in each home? Just brainstorming but I imagine these are the conversations going on right now...

Whatever happens they're not going to just drop novacyt and go with some other random untested option now, however little you trust or respect the government!

I would imagine it's the logistics around a contract that is holding it up, rather than whether or not a contract is to be agreed.
So manufacturing of q16 and q32s has been scaled up more than five fold, ballpark figure 1600 instruments are being built a month, with further expansion planned. We have no idea of the stock levels already but I imagine by christmas they should have 3000+ machines available...

107 is just a number, it doesn't mean anything by itself. But if what you meant was life saving treatment, £87m secured for a placing and mcap £200m - then I'd have to agree...

i) Positive results from the care home clinical trial interim data
ii) 4 director purchases, two of which were very large
iii) Extreme pressure building on the government to roll out testing into care homes.

It's highly likely ncyt secures a big contract very, very soon.

Yogi I feel that way too but like with the most recent DHSC order, it took time for the market to react but when it did the sp moved very fast (from about £4.50 to £12 in three weeks). If a new even larger order lands it won't be ignored...

Many investors seem to have the inaccurate idea that reduced sales in the following years will equal a fall in share price but that isn't the case. Currently sales are at an extraordinary level and for that reason we're working on the basis of a p/e ratio of about 2. So right now it's a case of making hay whilst the sun shines and planning for what this company will look like 12, 18, 24 months down the road.

2020 - expected EBITDA £229m
2021 - expected EBITDA £283m
Mcap £550m

By 2022 an EBITDA of ~£100m should give an mcap of ~£2.5b (P/e of 25 still low if debtless and cash rich).

You'd expect covid related revenue in 2022 to tail off*

At that point if things have gone to plan we'll be sitting on more cash than the current mcap. You'd expect covid related revenue in 2022 but a good management team should engineer new revenue streams with two years of planning and hundreds of millions of pounds.

Thanks for that extra detail Steve, very achievable!

Steve, that's partly why the broker note makes me so confident. Numis target is £13.65 based on revenue of £305m this year, £387 in 2021 and £137 in 2022. That's right 70% upside from here based on extremely conservative sales forecasts...

So we've been involved in this care home clinical trial across London, using the q16 and q32s for near patient testing. Does anyone understand what the end game is here? I think I read before that there were 16000 care homes in the UK and I'm not even sure that includes nursing homes. What on earth would a contract to supply care homes with our portable devices/assay kits/tests even look like? If the DHSC contract is anything to go by the figures involved would be astronomical...

Interesting looking at some of the late reported trades:
12:12 sell £109k @ 740p.
12:28 sell £310k @ 776p.

I bet they thought they'd sell and buy back cheaper later...

I've got a question for those that have significant experience investing in AIM companies: how useful are broker forecasts?

Currently I'm placing quite a bit of weight on the SP Angel and Numis broker notes. Take Numis, they are extremely bullish about this stock right now, have a target 70% above the current share price and suggest the forecast will be increased if P2 of the DHSC contract is triggered (which must be pretty likely now). On top of this the projected figures appear rather conservative and do not take into account further acquisitions.

Anyone got strong views on the usefulness of these broker notes?

donna you surely must be able to magnify it in order to read it?! Open in new tab then hit the magnifying glass or ctrl +

TLDR - Share price (this morn) 897p, broker target £13.65 - BUY. Possible upgrade to the target soon if phase 2 of DHSC contract triggered.

Vaccine is neither noise nor a game changer. A vaccine was clearly expected at some point otherwise we wouldn't be at £8 a share. If a vaccine wasn't priced in the market would assume we could continue to generate hundreds of millions of pounds a month from selling covid tests and we'd be looking at a share price 15-30 times higher!

As it happens I increased my holding in novacyt even further today and it now makes up most of my portfolio. Yes I know that is reckless but I am certain the market has not grasped the potential here. Sentiment moved away from us again with the vaccine news but I'd argue it should be with us after the news from the past few days and will be again very soon. All we keep hearing is PCR PCR PCR. By now it was expected we'd be using more rapid tests with PCR as a confirmation but that is clearly not the way things are going. Then you've got the two new mega labs which we will likely be heavily involved in. Then you've got the R&D update from this morning.

I don't know about you but I'm bullish.

Porky, was the £20m a typo? Did you mean £2m?

I'm really not worried, over the medium term this will at least hit the broker target of £14. Do you have the link to the £20m contract you're referring to? I can't remember seeing it...

The share price can still fall Gell!