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Morning all,
Glorious weather today.
Spot on Sea, grab a few moments in the sun if you can. Appreciate the freedoms we have, not being subjected to the brutality of mad vlad or Covid lock downs.
We know TEK are beavering away in the background.
Lot of coverage in terms of ethical investing at the moment. TEK are looking to enhance lives (I) health: belluscura and salarius ii) safety: Lucyd (the glasses, maintains sound awareness while listening to media) and Guident (enhancing safety of autonomy’s vehicles)
We are in the right place with TEK .
News around the corner
GLA
Morning all,
Stating the obvious, we should be mindful of the distinction between the SP performance and the company performance.
“The short term is a voting contest, the long term a weighing machine”
Tech stocks generally have taken a pounding because of rising interest rates and slower rates of projected growth (earnings). Decreasing the relative attractiveness of equities. Tying into the interesting contribution on DCF from Agricore.
All things being equal , then yes, the background of increasing interest rates does reduce the present value of of TEK’s future cash flows…..but in the real world who can accurately estimate TEK’s future cash flows?
The very essence of DCF is you are trying to estimate the time value of money ….so the methodology is focussed (designed) to focus on the medium to long term.
I couldn’t tell you, with any degree of meaningful accuracy, what TEKs cash flows will be in one or two years time….let alone the medium to long term .
The sales for Saltme crisp increased from $4k at January 2021 to $125k at January 2022. Where will the sales figures end up? Fingers in the air time….crisps are just an offshoot from core business of selling salt.
Bell sales figures are not mature enough to project with any high degree of accuracy .
It is binary if Guident wins contracts or not .
TEK is trying to penetrate markets with new products and growth will either be exponential if successful or potentially abysmal if unsuccessful. Hence, I don’t think DCF provides a meaningful insight into the value of TEK.
In my simple mind, TEK SP is a bit more subdued than some, because it is the very opposite of a defensive stock, it is a start up and a micro cap.
In times of geopolitical turbulence, investors tend to seek the perceived safety havens (gold performing strongly ….though has dipped for now) and withdraw from perceived risky stocks like TEK.
There is no getting away from the fact that start ups are risk v reward.
I am aware of the underpinning value of BELL, upcoming Lucyd IPO and valuation of TEK’s IP. But, until concrete revenue streams are established, SP is going to bounce around on fluctuating (sometimes fragile) sentiment.
The direction of travel for TEK has been very impressive. I am heavily invested here and comfortable doing so. There are of course no guarantees anywhere in investment.
I expect TEK to maintain their solid performance and look forward to the next exciting developments.
GLA
The shelling of the nuclear power plant in Ukraine (while there has been no radiation leak) has caused shock waves.
A horrific situation in Ukraine. A scale of conflict and suffering in Europe that we hoped had been consigned to history.
Putin doubling down on the madness. A brutal and potentially protracted conflict.
Obviously are thoughts are with those on the front line.
In terms of the markets, they are all over the place.
Best wishes to long term holders , hope you have the finances in place to ride this out.
And most of all , hope this horror does not escalate further.
Happy to stand corrected but doubt salarius would release the exact cost of the salarius product ….would seriously inhibit negotiations with external parties.
Plus, economies of scale would make a difference, how big is the order?
If the cost was prohibitive, the management have their head screwed on, they would not have started this business. Plus, salarius has released its own crisp line (not as a loss leader).
Are you selling John after Lucyd IPO? You should have mentioned it :-)
To exit is the logical decision if you don’t believe in the potential of the portfolio companies to successfully penetrate their targeted markets. Good luck to you.
But, you criticised Sea for trading on a ‘view’. It is impossible to derive TEKs intrinsic value from analysing the accounts/NAV. These are growth products in newly evolving markets. Future earnings (TEK’s value) can only be estimated by taking a view.
Time will tell …
GLA
Appreciate the update Sea.
The Shock absorbers are not core business and defo not priced in . It is fair to say there has been radio silence on their status from TEK. I believe them to be a strong product and am hoping the wizards under Harald Braun can enhance the technology further .
GLA
Around the placing price.
Nobody likes to see their investments falling in value.
Negativity and nervousness creeping in. But, in real terms this share bounces around on relatively small volumes.
There ARE some macro head winds at the moment.
In terms of TEK’s fundamental value what has really changed ? Is it proportionate to this drop?
If you are an investor, not a short term trader you have to take the rough with the smooth on occasion if you believe in the company (portfolios and the management). While not risking more than you can afford to lose.
This is a growth company (with a tiny market cap) on a journey.
If you are able to jump in and jump out at the correct points, very well done. I sincerely wish the long term posters on here good luck.
The known risk being, this share (like other fledgling companies) responds to RNS announcements in a big way.
Nobody owes blind allegiance to TEK (so respect exiting strategies) but my view is there is always an announcement round the corner with this promising company. The management have bought a fair degree of faith and credibility with their achievements to date.
Am excited to see what news drops next with this share.
GLA
In relation to autonomous vehicles I noted another player now operating in Las Vegas .
A remote driver , delivers a taxi to your pick up point . You then drive the vehicle yourself (only within the confines of Las Vegas currently). This business model means halo do not have passenger liability.
Halo is leveraging off 5G network technology to deal with the low latency requirement. I don’t know how the latency compares to the Guident offering (but Halo looks very effective).
https://halo.car/
The autonomous vehicle market is going to take off. Guident has award winning , patented low latency technology and has built sophisticated algorithms to efficiently manage fleet business. Hopefully it is well placed to take a share of what will inevitably be a booming market.
In relation to salarius there is a significant interest in the product . 30 companies have commenced testing and evaluation. We don’t know the current status but I don’t believe (pure judgement call) interest will evaporate. As evidenced by the FDA guidance and approach, reducing sodium chloride intake is an issue of increasing focus:
https://www.fda.gov/food/food-additives-petitions/sodium-reduction
GLA
The regenerative shock absorbers are not core business.
They said , they are an award winning piece of R&D technology and potentially a golden egg.
Harald Braun said that in testing the extra range generated by the shocks was entirely in keeping with the spec of the patent. They assumed on class A roads you would get 4 shocks per journey adding 5 miles of additional range (bumpy terrain and extended range of the journey - due to enhancements in the battery technology - would proportionately increase the number of shocks ).
Remember this technology is primarily aimed at (but not limited to) electronic AV fleet business. Start accumulating the additional mileage generated by the shocks across a fleet of AVs operating 24 hours a day and you get some material savings in terms of financial costs (in a world of tight financial margins).
We have no information on the testing from the parties who signed non disclosure agreements with TEK. But, we do know that they entered into the testing knowing the prescribed limitations of the current shocks technology …..so these manufacturers believe the increases to be significant.
We are due an update on the shocks
GLA
The extra miles from the regenerative shock absorbers would be proportionate to the mileage.
So if the Tesla range increased from 400 to 600 miles, the output of the regenerative shock absorbers would increase by 50% also (in this example)
And that is before the technology is inevitably enhanced
Guident is a super Star in our back pocket.
We may have a “quick” win on the regenerative shock absorbers (non-core business).
However, the true value of the core business will not be realised until the AV market develops further (could take some time but will happen). Interesting as the plan to IPO may be sooner (reflecting the huge potential).
To the best of my knowledge …..
The Guident technology is designed to manage AVs (particularly fleets of AVs) but currently AVs do not exist on our roads in commercially viable numbers (think they are experimental areas only in the US). So while the Guident RMCC is open and they are communicating with potential clients, a revenue stream may not come to fruition immediately .
This Guident technology can be applied in a variety of settings. AVs while not on our roads (in significant numbers) are already utilised in sectors such as mining (performing repetitive routes/actions). Harald Braun gave the real world example of a mining truck (operating autonomously) that went haywire. The damage could have been huge. The guident proposition would have resolved the problem. At the point the AV truck began behaving erratically , a human operator at the low latency RMCC (the Guident technology) could have assumed control of the vehicle and prevented damage to the truck, property and potentially human life (don’t believe in this particular incident there was any loss of life). The case for the Guident technology is so convincing.
The low latency technology describes the ability of the human operator to control the AV in “real time” (in the event of an incident/collision). The human operator is able to assume control of the AV with minimal time lag (key in terms of safety, as it is obviously essential that the human controller is controlling the AV in as close to real time as possible , while sat at the RMCC).
So I think the low latency technology is the “ bridge” from current AV technology to level 5 autonomy…..level 5 being where the human intervention is no longer required (at Level 5, the RMCC is no longer required in the same way).
It is law, in a number of US states, that in order to operate AVs you must have a RMCC. So Guident can hopefully leverage their early mover advantage in addition to their pioneering low latency technology.
A really exciting company !!
GLA
Not surprised by the subdued reaction.
We knew it was to IPO shortly, so why should it shift the dial?
Continue to be of the view , as expressed by others, that the SP does not reflect the true value of the underlying portfolios .
Don’t think this is the announcement that is going to spark that market recognition
GLA.
SP well over double relative to this time last year.
So curious to associate this particular bb for rampers lacking business acumen.
Clearly, many investors on this BB have recognised the value being created on this journey.
Warren Buffet himself could not forecast the future SP exactly, as these are immature portfolios (in undeveloped markets in the case of guident)
….but based on all known information (not going to regurgitate all the positive developments this year), it is simply going superbly well (with BELL the stand out this calendar year for underpinning the TEK SP) .
Excited to see what emerges next, TEK has many strings to its bow !
GLA
Yup, entirely judgemental …
But, that is the name of the game when investing in start ups. Formulate your “best guess” of a reasonable range of IPO values, then try and infer the additional value that will mean to the TEK SP.
When you say, could just as easily be $5m, that is not correct in my opinion . That would be outside the range of expected outcomes
There is no legitimate comparison between TEK food and salarius.
Salt is a core ingredient for food generally .
Smart food TEK related to a fried chicken substitute only (you could bake it ).
I think it’s fair to say they have different sized addressable markets !
GLA
The future has been mapped out for TEK. All portfolios to sold/IPO’d in the next two years is the likely scenario.
The potential exists for an exciting return, far in excess of the current SP.
Got to take the rough with the smooth, I will be sitting on my hands. No KNOWN change to the fundamentals.
It has proved a fine strategy with TEK thus far. The only time I was slightly caught out, was the extent of the last discount. That said , I bought more just above 10p and that has paid off handsomely too.
Hopefully there is NOT an imminent raise. Though of course it can’t be ruled out .
The raise last time was heavily discounted in part due to the time pressured nature of the raise, with TEK having limited time to exercise their rights in relation to belluscura. In theory that extreme time pressure should not exist in any future raise. So should not be so heavily discounted (if , I say IF, there is a raise)
The tree will be shaken from time to time. Seen TEK share price swing violently many times . Good company going places .
Good luck all