FYI: Analysis Novacyt in Feb 2020 @ 27p. GBP 12:00 last month15 Nov 2020 11:05
This was posted on the French website when NCYT was 25c in France: Wish I had stayed with CYT. St was volatile as it her on RMS. Let's see we we are in 2 weeks time, December !
"Novacyt is the only one to develop a test to detect Corona virus"
Novacyt rises 81%
The Novacyt share shot up on Friday, January 31, after the company announced it had developed a test to detect the Corona virus. The test, called genesig® 2019-nCoV, is now for sale and orders are coming in. According to the first reports, tens of thousands of tests have already been sold in around 10 countries. The rate can rise much further than where it is now is our expectation. The share of the France company increased no less than 81% from 0.25 euros to 0.45 euros. After Friday's price rise, the market value is 26.2 million euros. That is only a small amount based on the potential revenue growth that can be expected from the sale of the Corona virus tests.
Genesig® 2019-nCoV
The genesig® 2019-nCoV is the first test in the world developed to detect the Corona virus. That is why the company currently has a huge gold mine. There are two different tests for sale, one cost converted to euros per package (150 pieces) around 300 euros and the other per package (150 pieces) 700 euros. The latter test can determine within two hours whether someone is wearing the Corona virus. The Corona virus, which originally started in China, has since spread to several countries.
Turnover can be tenfold
The question is how many tests the company will take. That is of course very difficult to determine and will depend on how long and how far the virus continues to spread. Suppose the company is going to sell 100,000 tests worldwide, that gives a turnover of around 40 million euros. The stock market value after the price rise last Friday is 26.2 million euros. There are currently 57 million shares outstanding. The turnover for 2019 was 13 million euros. Suppose that the result is repeated with the sale of the test, then the turnover for 2020 will be around € 53 million. Suppose the virus continues to expand, we estimate that the test will be sold more than a million times. The turnover would then be tenfold and yield 400 million euros.
Price target 7 euros
Again, it is guessing about the actual sale of the Novacyt tests. Nevertheless, the enormous demand for the product provides enough certainty to expect a turnover explosion for 2020. In a negative scenario, the total turnover can amount to 53 million euros. In a positive scenario, sales will amount to 450 million euros. If we look at Novacyt's average valuation over the past 10 years, the rate could rise to between 1 euro and 7 euros. In the first case, that means a price potential based on Friday's closing price of 110%. In the second scenario, the rate can even rise by 1500%. The news about the Corona virus will hold the share in its grip in the coming days and we expect the price to rise further next week.
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