ShareProphets

The one stop source for breaking news, expert analysis, and podcasts on fast-moving AIM and LSE listed shares


Join ShareProphets at less than 2p per article

> Hot share tips

> All the big AIM fraud exposés

> 300 articles and podcasts a month

> Original investigations by our experienced team

> No ads, no click-bait, no auto-play videos

Find out more

Tom Winnifrith's share tips of the year No 7 - Buy Premaitha at 18.5p - target 30p

By Tom Winnifrith | Sunday 3 January 2016


Disclosure: Financial Investigative Media Limited, which is not owned by Tom Winnifrith but by a trust for his dependants, owns shares in companies mentioned in this article. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.


Ok this was one of my less successful share tips of the year for 2015 but this time it really will come good. That will be the prompt for guffaws of laughter from Wildes, who is currently sitting on a sinking lifeboat from the doomed SS LGO Energy. But he who laughs last... 

Premaitha has developed a test, IONA, for Down's syndrome. It is non invasive (hence safer tha existing tech) and also far more accurate. This is a multi billion dollar market and it is already winning contracts. Following a £8 million placing earlier this year it has net cash of £6 million right now. It also has a £5 million loan facility available from $17 billion revenue science company Thermo Fisher.

So why are the shares not flying? Partly becuase it is taking longer than expected to win contracts. Contracts are being won but intertia is always the great enemy of innovation. Secondly US giant Illumina is "trying it on" with a patent challenge. The two companies will be in Court later this year (2016) but I reckon that Illumina has form in trying to crush smaller rivals and will lose. Wildes disagrees. We shall see.

Interim results showed revenue up to £0.62 million, from £0.13 million in the period to end March, as a result of sales of the company’s February-launched, first CE-marked non-invasive prenatal test, IONA. But that is just four months and when Premaiths wins a contract it typically lasts three years. So if sales hit £2 or £3 million this year then that is the base for the year after, etc etc. With high gross margins I expect Premaitha to be profitable from 2016 onwards and profits to ramp up quickly thereafter.

What will trigger a re-rating? Firstly more contract wins and there are - I believe - a good number in the pipeline. The company says it is on track to have 10 in the bag by the year end. Secondly FY numbers will show the scaleability of this business and thirdly a defeat of Illumina.

The shares are a buy at 18.25p and at up to 22p with a year end target of in excess of 30p.

To read Tom Winnifrith's first share tip of the year (a buy) click HERE

To read Tom Winnifrith's second share tip of the year (a sell) click HERE

To read Tom Winnifrith's third share tip of the year (a buy) click HERE

To read Tom Winnifrith's fourth share tip of the year (a sell) click HERE

To read Tom Winnifrith's fifth share tip of the year (a sell) click HERE

To read Tom Winnifrith's sixth share tip of the year (a sell) click HERE


Filed under:


Never miss a story.




This area of the ShareProphets.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ShareProphets.com. ShareProphets.com does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ShareProphets.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ShareProphets.com and is not intended to be relied upon by users in making (or refraining from making) any investment decisions.


More on NIPT


Comments

1 comments

  1. I shall wait for the court case and buy em up cheap ……… sorry got to dash …… I have deck chairs to re arrange .


Enter your comment below. Fields marked * are required. You must preview your comment first before finally posting.




Site by Everywhen