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Just to add, you did ask what would we do with the £10,000.
I think this will be different for every different person. I don't disagree with Moniman's 50/50. I think on balance I personally would at this stage go 70% Orph and 30% Poolbeg. But that is not advice in any way. As 5 different people would give 5 different answers.
What swings it to 70% for me is the further spin offs and also a more known revenue path. But for Poolbeg this could potentially see a good uplift in price if something big drops. So that 30% would keep my hat in the ring there.
Just me. DYOR.
Hi Fluffer. Of course, what I write below is just my opinion, and only looking back in a couple of years will we know. But regardless, here’s where I am.
Open Orphan
The £10 million contract that dropped last week settled any nerves I may have had. ORPH now has 90% of forecast revenue accounted for in 2022. And it is a reasonable bet that more will follow. Cathal Friel and ORPH had a reset of how they are presenting things. And recently he has tried to take a, “I’ll let you know when it happens,” approach, rather than a, “I’ll paint you a picture,” approach.
I personally believe at some point soon the share price for Open Orphan will start to move up. Even the most pessimistic person will find it hard to argue with contracts on the books. 2020 (Jan-Dec), the revenue was about £20 million. 2021 revenue is forecast to be about £40 million. It will only take a few nudges to increase the already booked £45 million to be £60 million for 2022. Then we have 50% growth for two consecutive years. It looks like £60 million has a chance of being beaten next year but the CEO is playing it close to his chest.
I believe, with the prospect of decent growth and the prospect of further spin offs, the bearish sentiment around ORPH will lift. I think the sellers will probably exhaust themselves. And there are a few signs of this now. With the SP hovering about 19/20p, soon all that want to sell at this price will have sold. Of course, it could take another dive down, but resistance has proven pretty stubborn at 18.5p. And there has been three recent contract announcements which may change some bears minds in the short term.
Poobeg
I have the luxury of receiving POLB shares via the spin off in June / July. And I haven’t as yet bought any more. Currently POLB is below its 10p IPO price, and could be argued is really good value down here. The lock in will expire 9 months after IPO and lots of share holders will be able to sell. I believe most will simply hold and buy any dips caused by selling.
Will POLB price be higher than 10p then? I mean, it could be 20p, and take a dip to 16p, where people buy them up. Or it could be 11p and take a dip to below 10p again. But then again, not all lock ups end up causing a share drop.
CF has recently stated that both ORPH and POLB are going to get some key attention with a view to lifting their share prices. Of course, no one can claim to shift a share price. But through news they could cause a good lift in sentiment for both.
Since the POLB IPO there has been some stubborn sellers on Open Orphan. They will all get POLB shares even if they have sold down their ORPH. Will they sell straight away, or will they wait for the price to rise.
I feel excited for POLB. Even time I hear it talked about I see a good future.
Any experienced long-term investor will say you cannot predict short term price action. So you take your best guess. But over time these things weigh out, and the market catches up. J
JimBeann filtered.
Shame because any relevant points you make are just lost in you being so argumentative.
One thing that really came across was how they would interrogate the data from human challenge trials to find new opportunities. Not new info, but really came home to me how this would work.
I was at the meeting. I found the potential of Poolbeg hugely exciting.
Not sure there was any new info given and many of questions were from new PIs.
I really like Jeremy Skillington’s style though and comes across as very competent.
Any one of their drugs that succeeds brings big money.
Hey, I was also there last night. In answer to a couple of questions, yes the tweet from Mariano Italiano on Twitter was a reasonable reflection:
"??3 more significant announcement this year
??DIM early next year
??Imutex and PrepBio nearly ready
?? Financial forecast on track
That sounds good to me????
#orph is so undervalued on its own not counting spin offs ( each of them could be massive) and Covid19 trials on top ??"
https://twitter.com/maciejgerges/status/1456168422467936258
Some seem disappointed to not have more info. But there was a talk covering stuff most LTHs would be familiar with. Then much of the question time was taken up with PIs not familiar with the share. Only really time for maybe four or five questions in total. And 3 of those were questions relating to things LTHs would already know. No time for further detail. More questions often gets covered in the video calls.
For me, my take away was to get 2 or 3 contacts announced by Christmas. Movement on DIM in new year. Imutex and Prep still targeted for dividend in species.
Some are getting fearful it seems. But to paraphrase the Buffett, that’s the time to get greedy! DYOR.
Strictly I hear you. It is nerve-racking stuff long term holding sometimes. All the research seems to indicate that multi baggers can take nerves of steel as they can be volatile. But you only lose when you sell. So I am holding tight. I haven’t bought for a while as I’m all in. I suspect there are many like me.
I relistened to the audio that Elric recorded a couple of weeks ago and the story really is very similar to the one so many bought into. I have a fairly significant holding. Enough for me to be very focussed on this share. And I have found relistening to be really good and somewhat reassuring. I know some get down on CF but it is not all about him. There are so many talented people at Open Orphan.
As it is said in the short term the market is a voting machine and long term a weighing machine.
There’s another AIM share I held that really only did minimal news and investor relations. We’re just not used to it here. I was actually not too upset with today’s price at the end of the day. Weak hands or people who bought at a lower price are selling. And we will have a whole new range of investors bought in in the low twenties to give strong support.
Yes Indeed Bazzaman. Will you be going?
Who is going to the physical meet up in Portsmouth on the 3rd November? I will be going. Will good to meet anyone from the LSE board.
I agree Mon. As the share price has been following the recent trajectory the evidence is gradually building up in the background. This last few weeks it feels like I have seen links to so many articles in which other countries are really talking seriously about CHIMS. hVIVO are referred to a number of times in this. The clues are all there.
Yes, thanks Wally!
Yes he did seem really bullish for next year!
Yes Bazzaman, I was pleased to hear there would be good news flow for rest of year.
Well, I thought that was a really accomplished presentation. First time I have seen Jeremy Skillington in full flow and he came across really well. Lots to be excited about.
Thanks Bazzaman. I’m signed up…
Yes Ryan. I agree about broker notes. They are merely another bit of info.
And if most of DIM goes to existing shareholders, as it seems like it might, then there may be very limited entry points to DIM for non share holders. They’ll need to get in post IPO. Oh, and pay for the shares too :)
JC. My understanding is that the Finncap target of 44p includes all spin offs and the 2022 predicted revenue £50 million. If revenue goes above £50 million, with the addition of Covid challenges in 2022 (that are not included), OR if you value the spin offs go higher than 11p total (which many think they will do), OR if you assign a higher revenue multiple of 4.5 (which in a bullish scenario is very possible) OR we just get higher than £50 mill anyway, then this will all take the SP total beyond 44p.
Basically the higher the revenue, and then profit the higher the share price should travel. For me, my target is 60p all in from here by end 2022. IMO with a bit of decent news we will be up near 30p. Then I’m hoping to double from there. Just my personal hopes / targets.
I agree Mon. At beginning of year we had a lowest share price of about 24p. It has rallied and come back to where we are now. But new things we now know (giving more certainty) are:
- Revenue 2021 should about double 2021
- New challenge studies are ready and being actioned
- We have more beds
- Dividend in species will happen (that was not solid)
- Covid challenge trials approved
- Profit margins substantially improved
Etc etc
Thanks Green! Yes 3.4 at £40 mill revenue puts us almost exactly where we are with the current share price. But as you say, completely ignores any dividend in species opportunities.
I think I’m right in saying that Finncap used a multiple of 4.5 of revenue when they set a target (excluding spin offs) of 33p per share which was based on the forecast of 2022 £50 mill turnover. (Their total target being 44p as previously stated).
Others have argued even higher multiples on here before of 6 or even 8 arguing a wide moat. So I think 3.4 could be seen as a lower, almost worst case scenario multiple.
As we know as sentiment shifts people are happy with higher multiples.
I’d love to see Prep or Imutex drop Q4. And I suspect, no evidence, it is possible. I think CF deliberately took the wind completely out of the spin outs to take away pressure and let people concentrate on the business.
And I think 4 contracts in the coming months would really give an upward push!
But in amongst all this, I think Cathal likes dropping nice surprises. So I wouldn't be surprised to see spin off news come pre Christmas. Or suddenly a 4th facility to appear. Or some surprise good Covid news to come our way.
“In the short run, the market is a voting machine but in the long run, it is a weighing machine.” Benjamin Graham.
Over the last months people have been selling more than they have been buying. Although this is not technically true, as there is a buyer for every sold share. People have been “voting” by selling when they didn’t like the news of postponed spin offs, or some of the Covid money would be in 2022 instead of 2021. If we take our eyes off these distractions, contracts have been dropping in all sorts of new areas like malaria and RSV.
Over time the “weighing” will get undeniable (I hope) as people do the turnover maths and see how lowly the share price is right now. I would hope that the pressure of new contracts gradually tips the weighing machine towards a fourth facility, and the inevitable extra revenue.
This may not be correct, but as the share price drops today I visually see people just getting impatient and just kicking their shares out of their nest. Any Benjamin Graham or Peter Lynch readers can bring up all sorts of quotes to say, you make the most money when you stick with a share. Check the fundamentals. Look at future revenue potentials. Look at the management. Look at the sector they are in. Do all your checks. And if everything looks good, stick with it.
I think for new investors, or those adding to positions this price has to be great value.
No advice intended. Do your own research. Best of luck!