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Hi Sogamla, I didn’t read the Fincapp appraisal as negative. At worst it was neutral, and in my opinion positive. The 28p valuation explicitly never included wearables (circa another 28p minimum if you believe CF’s comments) nor did it include Imutex (circa another 20p) nor did it include 3rd or 4th facility projected extra income (circa another 20p minimum?) nor did it include PRep Bio. On that basis 28p probably isn’t greatly undervaluing ORPH’s core present trading business and gives comfort to anyone invested, or potentially investing, that they’re on a free ride from here until all the other assets are monetised. GLA
I remember last year when the Woodford shares were being sold down and suppressing the stock price that CF said that he’d spoke to the Woodford fund (Link?) and “offered to buy the shares at prices above market level but they’d refused, which was odd”.
ORPH has a very healthy cash balance and could easily do that now (and I think CF spoke only a few months ago about returning surplus cash to shareholders). There’s certainly enough in the bank (£22m?) to take out Investco now (circa £9.5m holdings).
Maybe Investco are nearing the end of their sales (I’m sure CF will know exactly how much they intend to sell) and CF is just letting them complete these sales. Who knows?
GLA
A-d-v-f-n
Over on a-v-f-n d there’s a post tonight from 1gw who seems to have a good handle on the shareholding % situation. He confirms Investco held only 7.86% before their recent sell off (not 9.86%).
The 7.86% held by Invesco only represented 0.47% of their total holdings in the two Invesco funds which hold ORPH shares. This RNS has reduced their holding by approximately one quarter (24%). I don’t think this this amounts to them jumping ship.
Also, I notice from their website that the fund manager Mark Barnet was replaced in 2020 and another two people appointed. What are the chances these two people will invest in exactly the same shares with exactly the same shareholding as somebody else has done before them?
They’ve probably identified other Companies, in other sectors, which they find more compelling (e.g. alternative energy companies such as Eqtec). I’ve personally resisted selling any shares I’ve bought in ORPH but have been tempted to sell and invest into Companies where “multi bagging” is constantly mentioned in other share chats. I’ve resisted the urge to divest in ORPH, but Investec haven’t.
I deem ORPH a near certainty to at least double in 2021. Maybe Investec think the same, but given their considerable resources and contacts they may have identified other stocks which they deem a near certainty to treble or more in 2021.
If I found another stock which had a better chance than ORPH of at least doubling, then I’d invest elsewhere too. Who wouldn’t?
Also, this stock price has increased over the period of the Investec sell off. That shows the confidence the market now has in this stock, and with Investecs selling at an end (hopefully) then the stock price now has little to hold it back from here. IMO
GLA
Demon - it certainly looks wrong if you look at the Morning Star link that ‘RFinvestements’ posted on 31-12-20. That clearly shows Invesco held 7.86%.
In the last few weeks we’ve had at least 5 recommendations/positive news flow from ‘professional’ investors/bloggers ;
-Finncap
-Share talk
-Total market solutions
-Value the markets (fantastic write up, as posted by Whouse yesterday)
-Share soc’s ‘Donald and Dave’ (where Donald recommended ORPH, and Donald is a Footsie 250 Company Director)
Any more?
The share price is only going one way over the coming 12 months.
GLA
Finncap have this morning published a research note on ORPH.
They put a target price on ORPH of 28p.
However they say this price “EXCLUDES potential revenues from new quarantine facility, non core assets (Imutex and PREp Biopharm), monetisation of infectious disease data , development of new challenge study models, and potential for licensing challenge agents”
They also estimate £43.9m turnover to 31-12-21, with £6.6m EBT (earnings before tax).
GLA
Hi Whouse- Agreed, and that’s why I posted to show the ignorance / mis-representation of ORPH at this point, albeit not deliberate from Stockopedia. They will have ignored wearables and Imutex as they are non core and non balance sheets items. They will also have ignored CF’s news regarding the 3rd, and probable 4th, testing facilities being added. Therefore a lot of PI’s will have been put off from investing who consulted Stockopedias ranking.
However, slowly but surely, that perception is changing and the pace of change is quickening IMO.
GLA
Value is still only scored as a 6 though :-(
Bazza, thanks for the correction. I got that information only yesterday (when I typed my post for today’s posting) so it’s been updated today. Obviously anyone looking at it before today will have been scared away by the rating I posted. Like you say perceptions are changing for the better in a wide variety of forums affecting investors sentiment.
Yet on the same website there is a link to a Share-soc podcast in November 2020 by ‘Donald & Dave’ where they discuss circa 7 stocks in the pharma sector. ORPH was painted in a very positive light, but Dave admitted he hadn’t even heard of ORPH when Donald proposed they be included in the programme. Hence a so called UK based professional paid expert had not heard of a stock with a market cap of circa £150m and which had increased its market cap by some 450% + that year, and was also constantly reported in national news items relating to covid.
However our profile is definitely now higher than ever before, and will be increasing daily, and I think we’ve now regained our share price ‘momentum’ which in itself attracts investors who invest only in ‘momentum stocks’.
I’ve topped up myself this morning and am looking forward to a fantastic year ahead.
GLA
Happy New Year, hope it’s a happy and healthy one for you all.
Looks like the II’s have been buying back in during the last couple of days. Some posters on here expected this given CF said in December that some II’s were engaged in year end profit taking. I expect they’re buying back in now, and new II’s are too hopefully.
The Morning Star II ownership figures discussed here on 31-12-20 showed ownership to 30-11-20. However they need updating as the link posted by ‘RFInvestments’ is currently showing that the Institutions sold only 11 million shares from March 20 to November 20.
Yet when this was posted originally on 31-12-20 the figures were a net 33 million shares sold, implying that the II’s have bought a net 22 million in December 20, which obviously can’t be correct and is also at odds with CF’s comments.
Certainly some new PI’s (and maybe II’s?) will have been drawn in to invest based on the very recent share tips on Share Talk and Total Market Solutions to name two. (Share talk recommended DVRG as the ‘new Open Orphan)
I really think ORPH’s profile is now therefore starting to reach a much wider audience of investors.
The vast majority of current investors in ORPH will have researched it to varying degrees before investing their money. Yet multi million people in the investment community will not have even heard of ORPH let alone done any research. Existing investors know the investment case is so compelling and we’re puzzled why everyone else does not too.
I’m an investor in a number of stocks and this puzzlement is a very common theme on a lot of those chat threads too. We are not alone at ORPH in our puzzlement.
I’ve not been an investor for long, but have also been very surprised by the level of ignorance and lack of basic investment detail I’ve encountered on so called ‘expert’ websites regarding ORPH. For example, I subscribe to Stockopedia and the ‘The Stockopedia Rating’ system, out of 100 (where higher is better) today scores ORPH as thus:
Quality 35
Value 7
Momentum 98
Based on the three scores above Stockopedia gives ORPH an underwhelming ‘Stockrank’ of 42.
It also states “ORPH qualifies for James Montiers Unholy Trinity screen (short selling)“
Anybody who had no prior knowledge of OPRH, and who read this stockopedia rating would not invest the hole in a washer in this stock, particularly as its key component ‘Value’ is scored as a pitiful 7 out of a possible 100 (and appears in red coloured bold as a warning). In addition Stockopedia rates ORPH as a ‘Momentum Trap’. (continued)
Sorry, 8 institutions, not 6.
The morning star table shows that six institutions out of the top 20 have sold all their shareholdings and these equate to approximately one third of the holdings in this top 20. (i.e. 33 million out of a total of 98 million). No idea when these were sold, but 33 million is a lot of sales (circa 5% of all shares) and would dampen the share price rise IMO.
Some II’s have been profit taking in last few weeks causing the share price to stagnate. Maybe existing other II’s are now making their move to load up further before the herd arrives in the new year driving up the share price. Still time though for those II’s who’ve been selling to sell a few more before their year end of 31-12-20. Let’s see what today brings.
CF did talk months ago about the prospect of a dividend being paid out of surplus cash around about now or early on in 2021. However, IMO, that was before the prospect of 2nd, 3rd and 4th facilities being added were firmly in the equation. Thus the funding required for these should be paid from the profits, and cash, currently being generated.
Some of the surplus cash earmarked for dividends will therefore now be invested instead in rent, equipment and salaries to pay for these extra facilities. Which is exactly the right thing to do as these facilities will generate enhanced profits. Therefore a bigger dividend should follow.
Moreover bigger profits will also boost the stock price (by multiple of 10 at least IMO). So if the extra facilities add an extra £20 million per annum to ORPH’s annual net profit, then ORPH’s market cap will be boosted by an extra £200 million (equivalent to £0.30p per share). More, if net profit or the market multiple is more. IMO. DYOR. GLA
From todays Sunday Times interview with Pascal Soriot, CEO of AstraZeneca, and it’s Business Person of the Year. “Soriot points towards an increasing appetite in countries such as China to pay for rare-disease drugs which can fetch a higher price.”
Cited as the reason AstraZeneca have just paid £28.6 billion to takeover the American rare drug Company Alexion.
Also, Forbes magazine on the takeover ;“The move would help the Company gain a foothold in the market for drugs for rare diseases”
Some chunky sales going through close to each other. Still II’s taking some year end profits it seems. Share price will stagnate IMO right up to 31-12-20. Then the same II’s will buy back in, probably increase their holdings and share price will increase, and the herd will follow etc. Can’t see any reason why an II would divest permanently with all the imminent news. It’s not as if ORPH hasn’t delivered in the past year, giving them approx 450% + annual increase . GLA
If it is feasible then this may explain current malaise in the share price on the back of two good RNS’s. The MM’s will have a vested interest in accumulating stock from weak PI’s now and selling them back at a higher price to II’s. The II’s, IMO, will be returning and increasing their holdings too in January, so MM’s will keep this stock price fairly stable until then. All IMO. GLA