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Seller continues, happy to nibble a few more at this level, turbulence expected given the company’s transitioning from loss to profit, think this is a top performer next year, well, let’s see…

There has also been a persistent seller about, close to 7mln shares traded on Tuesday taking the shares from 28p to 25p.

it's all just noise until the next update of course and I continue to think there could be upside gap risk if the company secures any funding from the US Chip Act, which Amercio Lemos and team are often talking about.

Well said joseywales, think that's spot on, all these small caps need newsflow and I suspect the pivot back to profitability will transform the level of interest in the stock. IQE has a strong list of shareholders which helps lend credibility to the company's strategy to return to growth and profitability.

Onwards to the interim results update, that should trigger some comments, well let's see!

(excerpt from Peel Hunt's published note 10/04/24, following the results:)

FY24E reiterated as 2H23 momentum is carrying into 1H24

• FY23 results in line. 1H23 to 2H23 momentum (rev +22%, EBITDA +275%) carried into 1Q24, giving confidence to FY24 expectations.

• This is helped by market share gain in Tier 1 Chinese Android OEMs that are growing in India, MEA, etc. Its AWSC relationship has been crucial.

• In compound semis epitaxy is the value driver, a global footprint delivers resilience, and innovation provides the future-proofing. This combo is helping IQE win new OEM opportunities to diversify its revenue base.

Putting fears of a lengthy correction to rest, IQE flags the “[ strengthening] order book [will] continue through 2024, despite [macro]”. Market share gains in Wireless, and increased confidence in GaN power qualification underpins this positive stance. IQE trades on 12x FY25E consensus EV/EBITDA: volume recovery should drive upgrades to the denominator. We reiterate our Buy rating and 61p TP.

Brokers are still forecasting conservatively, and rightly so, given the past few years and the number of false dawns IQE have had. I'm encouraged by their statement from the results update in April and the hosted investor call at the time, as a reminder:

"I am pleased with the resilience of the business and dedication of our people despite 2023 being a particularly challenging year for the semiconductor industry. As forecast, IQE returned to double digit growth in H2 over H1, and additionally took strategic actions to reshape our cost base as part of our ongoing commitment to improving margins and profitability. We made good progress against our diversification strategy following our investment into GaN capacity, with new customer design wins in the Power Electronics and Automotive sectors. Buoyed by the ongoing industry recovery, IQE is well positioned within the global value chain to deliver sustainable growth and capture opportunities in 2024 and beyond."

DYOR and GLA.

That’s a very fair point Gotrader, though the profitability trajectory appears to have changed and the new team that has moved in from Global Foundries are moving IQE into a much bigger market place and network. This is one of my stock picks for 2025 and my view is they return to profitability and strong growth heading into the new year. I also think there’s upside surprise risk from a combo of larger contracts with top tier players in the semi space and any potential grant awards in the US from the US Chip Act.

Well let’s see, 26p looks a good risk/reward level to me and happy to add at that level.

There’s been an ongoing seller in IQE for a while now but no RNS as yet. I have left a few bids in around 26p as see that as value entry point, I sold a few into the rally above 30p as thought the seller wasn’t done, long term hold for me but happy to trade around it.

Bots are tools, lol…

...I managed to buy some with a 26 handle this morning, news has clearly been positive but price driven by the sell-off in US tech, happy to buy the dip in this case.

Good volume day with close to 3.5m shares changing hands, there's still a seller around as the offer side continues to outweight the bids but this could change imminently with the higher volumes. I like the Taiwanise IPO story, good use of assets to improve their capital base. If they can bag a couple of material contracts I wouldn't be surprised to see this company moving nicely into positive free cashflow and decent profitability, plenty of upside ahead if/when this becomes the case. I'll look to add if it dips back below 30p.

Revenue for the first half is expected to be at least £65m, in line with management expectations. This represents a year-on-year increase of at least 25% (H1 2023: £52.0m) and half-on-half growth of c.3% from H2 2023.

The Group expects to report its interim results on 10 September 2024.

Yep, looking good here...

btw, the transcript of the recent AGM is well worth a read (or listen).

Looks like the US market is excited about the news!

Yes, this should be a game changer I agree, happy this has come out now and so close to the one-year anniversary of them being awarded FDA de novo marketing authorisation and of course more recently being included in the KDIGO Clinical Guidelines. So now it's full game-on then, interested parties should have everything they need to put some material bids on the table and the sales team should have everything they need to get the PCPs and clinics excited about frictionless adoption. Well, let's see!

DYOR and GLA!

Yes looks like it's going to trade down to 26p before the seller is done, good level to buy back in me thinks. This said, I'm equally happy paying 30p once its back on the front foot!

These micro/small caps are often overly impacted by single buyers/sellers aren't they, sheesh!

Good thoughts all round... I'd like to throw in that we're coming up for the one year anniversary of the company being granted FDA de novo marketing authorisation for KidneyIntelX.dkd. Completely irrelevant I'm sure, but suggests we should be close... LCD is the last piece of the puzzle the company needs to have widespread access to Medicare/Medicaid, in short a game-changer.

Well let's see!

FWIW, I wouldn't be surprised to see the shares re-trace back to 26p, or thereabouts, shares likely to drift until we hear more news from the company and then maybe it has another look above 30p...

Brilliant reply, lol...

Obvs someone's been selling down or exiting a positon, though the volumes are much lighter this week, so they may be coming to a close.

My guess it's the Citi chaps exiting their last clip of 4%/ish.

Not surprised it's 20% of the stop, standard operating procedure for UK small caps after a move up.

Looks like it was Lombard Odier topping their holding to just over 15%.

I'm not sure it's fair to put this on AIM, had Renalytix just stayed on AIM (and not dual-listed on Nasdaq), it would very likely be in a much better place financially.

I for one think they should ditch the US listing, which would probably reduce their burn by another 20-30%. They have little or nothing to show for the Nasdaq listing. I anticipated a good few US-based Healthcare specialist funds picking this up, but no such luck for Renalytix... Very telling...

Let's see what comes of the Formal Sales Process/Offer Period. The company said three or more interested parties were still around the table and we're close to 90 days into the process, so we must be close to the conclusion of this v.soon.

Lastly, post the results call the company announced an ATM (At-The_market) facility, run by HC Wainwright in the US, this allows them to sell shares into the market to raise funds for the company, this likely explains the dump in the US price last night.

Although the top line revs came in a bit lighter than desired, all the action is below this level, profit growth and the increasing shift to ARRs… Company is targeting £100m of ARR by 2026, cementing its shift to becoming a full on SaaS business.

Is this enough to stick it to the shorting hedge funds MWAM and GLG, one wonders?

Kainos is a very solid business and one to own for sure, assuming it can remain independent of course, given the Private Equity interest in DarkTrace and now Keyword Solutions…