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MCap is £51M and revenue is >£150M, but unless I'm mistaken we don't know profits yet. This was meant to be the first profitable year for Yu and that was before the FY revenue estimate was knocked out of the park with £156M contracted for next year.
Value investing is all about finding stocks which the market has mispriced for whatever reason, the efficient market hypothesis is blatantly incorrect. It is a safe utility company with disruptive technology that is growing very fast and has survived and thrived from the gas price meltup last year, reducing competition and freeing up customers. Yu is a microcap with low liquidity which is likely stopping it from reaching fair value, which should be multiples of the current SP. If anyone with moderately deep pockets, institutional investors or otherwise, got in here this would explode.
A possible reason for the bad market reaction is that DA latgely reiterated strategy presented at last meeting, meaning "we don't have one beyond COVID". Again they are very evasive when talking about exactly where they are going in the diagnostics industry, what they could develop products for and how big those addressable markets are. For the most part this reads like "the gravy train is slowing down but we're on board as long as it is moving and we are still looking for a connection".
The pandemic "end in sight" stories began almost a year ago and DA has been there 100 days. That is plenty of time to look and invest in other fields if you ask me, with the expertise and infrastructure they have. No mention of how their sales did with the Omicron surge either. Disappointing indeed.
Tuesday is going to be the update based on past years?
The first gut punch in this case is that COVID is perceived to be over and AVCT's LFT was pulled when demand is at all time highs, after a year of being blocked by the UK government sabotaging it and finally being able to sell. The second is that we've only had teasers about AVA6000 going well without concrete evidence. It would be nice if we had news about that to improve sentiment, but with the current track record people are hesitant even with the transformational potential of imminent news.
The issue with Yu's undervaluation has always been just spotlight and illiquidity. Under 10 trades a day most days, huge spread, acts like friction stopping it moving. Increased trading volume will reduce the friction, get others looking at it and wondering how this is still at this level. Looking forward to a trading update that really takes the brakes off. Unfortunately I did the same calculations about a year ago and got spiked. Still don't really know why.
There is still a lot going for the share and I think one of the several frustrations is that we are overdue results from AVA6000 at the very least. That would help to shore up confidence in the non-COVID plans.
The announcement was also poor strategically. They could have announced that they maintain sensitivity at high viral loads but they will transition out the antibody in a new product that returns to the high sensitivty at low viral loads. Completely possible to not have to halt manufacture and keep selling products, maybe at a discount, that work very well - just not excellently.
Things I'm confused by with this RNS:
1) No comment about whether this affects HUA status or the LFT has to go through 6mo+ recert
2) No news on sales numbers or production cap, or whether current test inventory has to be scrapped or can be remade
3) Admitting that almost all other tests are probably affected and don't have this data out (but not providing it either lol, just saying "it's worse"), so why release this data first? Especially if it's only affecting low viral loads so is comparable to Innova etc.?
4) AVA6000 dosing info should be with us early Dec I think, still no news but expanding trials
Maybe I've got some things wrong but I think this is just shooting yourself in the foot voluntarily and asking everyone else to do it, and when the main test manufacturer is already one-legged.
Nothing from this year has been factored in to the SP from Yu's fundamentals alone, so looking forward to results. Hopefully people will also realise that since a lot of SME competition have gone under and Yu have survived and thrived through prudent hedging, there is everything to play for in the coming years and growth should continue on a strong trajectory.
The palpable silence from DA is a serious. How little we have heard from him is just astounding. Not even a hello. Utterly confused as to why the management appear not just asleep at the wheel, but comatose.
Just a word to the wise, this is likely to be a completely media-driven frenzy about a boogeyman. Do we need to worry about the next VOC? Yes. Is this it? Probably no.
https://twitter.com/Pea****Flu/status/1478118173903839237
At this point the silence is so eerie and destructive to the SP that you have to think that they have a gag order! Either that or are intentionally keeping the price down for whatever reason.
EOY 2022 I expect this to be 5p after hitting 10p at some point during the year on a good bit of news. Could be finding the polymetallic orebody near EH or JV on Hanc0ck. With moderate news e.g. resource upgrade at Hanc0ck, valuation rerate from TP, some additional assays confirming a larger strike zone in Munni Munni, the SP I expect to be 2p after a smaller spike. Feels like it's all to play for next year.
There is a clear direction, it's just not gambling everything on one resource. Bill is working on Hanc0ck and Elizabeth Hill simultaneously and progressing both as fast as possible, since they are in completely different development phases and face different delays, this is possible. He is waiting for assays from EH while setting up the camp there and looking at Munni Munni data in the meantime. Less than a month ago the Hanc0ck project commenced phase 3 drilling and had a new company and crew installed that has already outsourced environmental permitting which is presumably also underway. These things just take time but the amount of activity in the last couple month has been nuts, but one thing I can't fault is direction. He's been giving interviews every other week about major moves in both projects.
I'm not that well versed on the viability of PGE projects but it sounds like those grades are way too low to be worth extracting. Would explain why they gave them up so cheaply. However, the raised grades in the nearby area and the halo that BBG has found at EH does all point towards there being a hidden ore body. It's a good thing that they have all the scoping studies across the area now so that they can map out the grades properly and see a distribution before they drill to find the source. There is a huge halo of PGEs in the area, hopefully this points to the ore body being similarly huge and a lot more concentrated. If the halo does pay off, this will be completely transformative. In the meanwhile Bill has brought on board guys to make moves being made on both Han**** and EH while he looks through the mapping data.
Really don't understand the arguments here about spreading too thin. Munni Munni is an extension to EH, one with huge resource that has been tied up by tenement parcelling that is now fixed under UFO. EHs halo is PGM, towards a suspected motherlode in Munni Munni North, with the whole of Munni Munni rife with PGM. The story seems obvious and BBG is focused on it. This isn't something separate to EH, it is all pieces of the same picture that UFO now owns 100% of.
Is this the reason why we're down today while every other COVID stock is up double digits?
Personally this development is in line with what I have been suspecting, that Bill has increasing confidence from the geology that there is something massive sitting in Munni Munni North that the current owners don't have the resources, expertise and/or incentive to investigate currently. However, the RNS still knocked my socks off. I really didn't dream that he would be able to bag the rest of the license for 10% of the company, with what is already known to be there and what Bill suspects. It seems like a good deal for Artemis but I think in a few years it will become obvious that they sold themselves short - maybe even in a few weeks when the EH assays come back. Platinum and palladium are critical for the future and add to Alien's diversification substantially. Incredible news imo.
Nah the placing was necessary and what has followed has only supported thate. There have been big hires, tents going up, real material progress in addition to the scoping. They are using the money to make the pie 100x bigger and ramp up towards production on multiple projects. The SP here has always been volatile and has been bounced around on no news, it really doesn't depend on the underlying assets. We just need a good news story or two to have people look at the resources and then people will rub their eyes and wonder how we've been sitting on this at sub 40M MCap.
I see. The mine would have been profitable since 2005 but I guess other cos felt like it wasn't worth their time? Hoping that the polymetallic halo theory comes through, if it was abandoned so long ago it would make sense that they didn't fully explore it since palladium etc. weren't such hot commodities as they are now. Feels overlooked but I guess unless you're a geologist you wouldn't really notice the signs. That's what I particularly like about UFO, led by someone who understands the science inside and out and can predict discoveries based on rock formations. Feels invaluable in an explorer.