The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
It needs a lot more than a new chairman.
The fundamentals are horrid.
ROC -18%
ROE -47%
Forward P/E 190
EPS -66p
Im not surprised people are shorting this. And yes, the revenue grows. But at what cost and where do the profits go? Negative EPS is never good news.
This will take years and a deep cultural shift to mend.
And a US listing won't favour this one either. SEC terrirotries have the tightest regulations on this planet. US markets don't like loss making, mature businesses either. Rest assured.
Shame. The potential is there but there is no evidence it will be realized in the near future.
I'd remain cautious.
There are a few, but not for the best reasons.
Ratios, valuations etc... are very useful filters. But it's important to look at the business and wanting to be part of that. Phil Fisher has a great body of work on qualitative aspects of businesses. And in the end, that's what matters the most.
Setbacks happen. Environments change.
To navigate capricious waters, one needs a stellar crew on a solid ship. The P/E is just the starting point.
Quality matters as much as does valuation.
Valuations are a futile business and it highly depends on the buyer for whom the valuation is made.
You can use ratios to compare and estimate, you can use DCF or whatever else (I use a modified version of the Graham formula). Whatever one does, the resulting figure will be a guess.
That's why I prefer to have a margin of safety. Usually, 30-50% -- which incidentally is my guaranteed rate of return when I'm right, and a sensible protection against downside when I'm wrong.
Thus said, if one cannot see that a business that is debt free, has 100+m cash and trades at a P/E around 2 has at least the margin of safety mentioned, well then I am truly perplexed.
ic52
We are in the 80's because Markets are inefficient in the short term. In the long term, they tend to price things correctly.
Or, as Ben Graham once quipped: "In the short term, the (stock) market is a voting machine, in the long term it is a weighing machine".
Patience.
Hydrogen fuel cells use platinum, although other materials are possible nowadays. The engineering challenges are substantial though. The US attempts to build a hydrogen economy since 2003 and it's still not delivered and far into the horizon.
Electric tech is very good and nice, but one needs quite a bit of fossil fuels for the batteries, and there is the recycle problem. On a practical level, the range may not be enough for a lot of commercial use cases and it would require a substantial investment in infrastructure (of which I haven't seen much yet). So it's ok if you live in an urban area and have off street parking and can run a chord to your EV. For others (most) it's not so practical unless there is a change point at every single parking bay.
How long is the chip shortage expected to last and what's the long term outlook?
From a reputable source: https://www.idc.com/getdoc.jsp?containerId=prAP48247621
Guess its the 'momentum factor' influencing these 'ratings'. Quite happy with contrarian stocks btw :)
Meanwhile there's been a few bloodbaths in other intersting stocks. Watching the corpses. Maybe there are some scaps left?
"furlough freddies" is indeed a good one. Made me chuckle humbly.
Something is cooking though. Interesting to read about progress on their projects, albeit the language is very restrained.
Don't want to set the expectations too high, don't we? At least, not before the chickens are roosting.
Good management has more legs than a good valuation. Have both? Lucky us.
Hi raxfactor
Precisely. It is this discrepancy that makes for lovely opportunities when the market becomes grossly inefficient.
Happy for the Market to offer me further discounts until the chip shortage is resolved :P
There's a lot more cash waiting for you, Sylvie