Probably could have structured it better, jump around a bit....anyways, here goes
I evaluate this stock purely on it's Artificial Intelligence and it's growing pipeline of intellectual property.
Focus my due diligence by looking at their clients
https://www.canada.ca/en/department-national-defence.html
https://www.nato.int/nato-welcome/index.html
https://www.cylab.cmu.edu/
https://www.arcyber.army.mil/
https://www.airforce.com/
https://www.spaceforce.mil/
I Look at their Co-Bidding Partners for $30-$50M Government contracts like
https://www.maxar.com/industries/defense-and-intelligence
https://www.lotte.co.kr/global/en/main.do#none
And as Marshall Gunter mentioned in a Corp. Video, there is otherGovernment
Co-Bid joint ventures. Interesting.. this to me is highest hanging fruit.
My point is, this is all I need to know if DM has the right technology for the time,
near time catalyst's like the upcoming US election which should coincide with the pending release of :
https://www.globenewswire.com/news-release/2020/06/29/2054899/0/en/Datametrex-Introduces-Nexalogy-SMART.html
I take particular note when attempting to access valuation on DM , that the bulk of SMART intellectual Property is derived from collaborated research done by DM on behalf of the Cdn. Government
https://www.globenewswire.com/news-release/2020/07/20/2064518/0/en/Datametrex-Awarded-208-800-Milestone-3-Completion-Payment-from-Canada-s-Defence-Innovation-Program.html
As stated by DM CEO Marshall Gunter in recent Corp. video, all IP derived from DM’s contribution to this Government funded research is 100% retained by DM.
So essentially “SMART comes at no cost to DM.
This isn’t just SMART, it’s more like BRILLIANT
I expect the enterprise value of DM to take a significant leap with this launch
Investors need only watch as the 2Q & 3Q financials roll in and decide for yourself if DM meets the definition of a Growth Stock:
https://www.fool.com/investing/stock-market/types-of-stocks/growth-stocks/
Not difficult to see it absolutely checks all the boxes.
To borrow from Torilif:
https://stockhouse.com/companies/bullboard?symbol=v.dm&postid=31407943
https://twitter.com/mjpd14/status/1282617804173258753?s=21
Why I choose to leave the Covid19 Rapid Testing Sales out of the equation , despite the fact that this potentially high revenue vertical for DM also comes at absolutely no cost to DM
:Zero R&D costs
:Zero manufacturing cost
No other pure-play CV testing stock that I know of can boast this.
Sure these others may yield better margins, once they are/if fully approved, manufactured & adopted, but they pose much bigger risks that DM does not incur as more and more tests are approved and there is hundreds coming.
The longer these others take getting commercialized , the more they are seeing their market-share diluted. Just as DM is seeing with iONEBIO.
Any mis-steps for these others like FDA or Health Canada revoking approval due to discovered deficiencies like Abbott Labs experienced in the U.S. and Spartan incurred in Canada & being relegated to “Research Only Status” poses vulnerability to the life cycle of any pure play like a Spartan, that remains solely dependent on
tax-payer funded subsidization in Gov. Attempt to reinvent the wheel, unless you have the balance sheet of a Abbott Labs.
Not a risk I want hanging over my investment thanks.
Thankfully DM incurs none of this risk by procuring the Tried & True, Battle-Tested Testing-Kits manufactured in South Korea.
Enjoying First To Market Advantage = Cash & Cash is King
My research tells me enterprises that consider entering the procurement & reselling market, generally need to realize margins between 30% to 50% to establish a robust & sustainable business model.
Based on this sliding scale, I am awarding the more conservative 30%
This to me shows the risk-reward is very attractive
DM has openly admitted that CV testing sales is not part of their wheelhouse , naturally it’s reasonable to assume with this in mind, that execution risk could occur.
Having said that tho, such is not presently the case, rather quite the opposite actually, and we are aware that DM is fielding daily inquiries from major industries and have a deep pipeline of potential that has Marshall and his team working 15 hour days & weekends.
If they manage to close deals in the 20% range of that potential in their pipeline, that could translate into testing sale revenues between $3M to $30M depending on the scale of customers: ie Film Industry, Airlines ect.
Yes, there remains enormous opportunity for continued sales and subsequent
re-orders of their rapid testing kits
(must admit I was very impressed the way management pivoted unlike most others in the space to ramp up their CV test sales platform and offer a full turnkey solution to Canadian corporations with their collaboration with TCI Labs)
But still tho for pragmatic reasons (like not expecting HC & FDA to approve iONEBIO or the Home Tests anytime soon) I choose to remove the entire CV testing sales segment to remove most of the unknowns & risk, and in keeping with the rule that to go long on any growth stock there also has to be sustainability.
Once this Pandemic outbreak subsides into the history books, many of these high flying CV-testing stocks will inevitably plummet to earth and some will even disappear.
Many new investors here were drawn to DM out of the opportunity to capitalize on companies offering solutions to the Pandemic Outbreak.
Not a bad move, on that premise alone looking at the 1000% gains realized here since the day DM announced answering the call by the Cdn Gov for their help procuring the gold standard South Korean CV Rapid Test Kits and the stock traded north of 100 million shares in one day tripping market trigger signals that garnered eyeballs around the world.
Since then , I will suggest it’s not unreasonable to assume many investors who bought into DM on that pivotable news , took profits with exorbitant gains north of the current share price,
but continuing to keep watch and do their due diligence, have since learned that there are very solid AI fundamentals that underfoot DM , and are choosing to re-enter or increase their holding based on these fundamentals and stellar execution of management landing continuous contracts for their AI which is beginning to allow for assessing “Forward Looking Earnings”
It’s the promise of their AI solution to battle what militaries around the world refer to social media warfare, that really allows me to sleep at night when I’m holding a large position.
What’s that promise you might ask?
The 10 year build out of Nexalogy’s AI and the culmination of machine learning & timing of 5G and release of Nexalogy SMART for 2021, is equivalent to a solar eclipse, perfect alignment of planets all in unison at just the right time.
The launch of a upgraded machine learning version of what is already regarded as a top social war fighting tools just as bandwidth speed is set to expand by as much as 50 times, places DM in a very niche position to establish itself as a real contender for any slice of the $25 Billion a year the Defence industry intends to spend on AI going forward.
https://www.nationaldefensemagazine.org/articles/2020/2/3/analysts-say-$25-billion-needed-annually-for-ai
I will contend that we are going to see AI leap so hard with 5G which is being rolled out as I write, it’s going to make peoples heads spin as we watch the race towards 6G and few have any idea just how fast this is all coming. It’s a race equal to the race to dominate space, and the US has the lead.
I hope this 5G-6G stuff is safe as their hasn’t been any independent research, and it appears to be “Damn The Torpedoes” mode
https://www.expresscomputer.in/networking/google-testing-secret-6ghz-network-in-17-states-in-us-report/62483/
https://www.cnbc.com/2019/11/07/china-starts-6g-development-having-just-turned-on-its-5g-mobile-network.html
Off - Topic & this not really the forum for this discussion: But I will just say
I hope this 5G-6G stuff is safe as there hasn’t been any independent research that I’m aware of, and it seems to be in “Damn The Torpedoes” mode
And it appears there is good reason to be suspicious ,
I found this https://youtu.be/dxCXfljzQ_0unnerving to the end and has me planning to call my MLA
Anyways Benj Gallander
https://www.moneyshow.com/expert/8c1481e4927c49f3870124dcb503dbe5/
Is a contrarian fund manager known for having some of the best returns in Canada for decades, recently joined the DM was a very bullish sign to me.
Known for doing forensic deep dive analysis of companies before he considers taking a board position
I’m sure Benj has considered everything I’ve mentioned here and a lot more that we are not even privy to, but if we trust his due diligence, he essentially did our due diligence for us.
I’m looking forward to Benj with his connections getting Marshall lined up with a interview on BNN when the time is appropriate
I didn’t view his tweet tonight as a negative against DM like some, just a request to @MJPD to stop spamming his feed about DM, he has many interests and this spotlighting obviously forced his hand to have to include the
old safe harbour statement, “venture penny stocks are very very speculative”
He has a reputation to maintain and this to respect other interests he is obligated to as well, DM isn’t the only BOD he sits on.
He is a very discrete kind of guy, and if there’s going to be any promoting with his name attached to it, it will be by him on BNN Market-call when he is good & ready, which I will point out, he has not been a guest on again since joining DM.
If this was meant to be a negative against DM in my opinion, he wouldn’t have said he sees potential and backs it up by reiterating being on the DM BOD.
Re: Back to the testing side of things
“Moss doesn’t grow on a rolling stone”
This management team never sat around waiting on Health Canada & FDA approval of iOnebio 15 minute PCR rapid test kit and the BIOCREDIT & the PCL Antigen + Antibody 5-minute Home Tests, they knew full well how slowly Government works, after years working with them to secure AI contracts with D.N.D. & Health Canada.
So they continue to press on, adding value to this segment albeit being new to this arena , and imho , have done a great job procuring additional test kits from various manufacturers adding a line of fully vetted PPE, establishing collaborations with labs like TCI which helped them secure some very nice turnkey contracts in the mining sector.
I think it’s fair to say at the least we are very likely see more turnkey testing contracts evolve in the mining space as this is a area the company has proven itself with what Marshall has described as the some of the largest mining conglomerates in Canada.
There are still many sitting on the fence that will likely join with us as reorders roll in.
How many contracts will they win?
How big will those contracts be in scale?
How long these contracts last?
That’s the unknown.
Bottom line, Money will be made and that money will cover expenses and help to fund the AI buildout.
Historically speaking , the CV Testing development announced back in April will be looked back on as the Big De-Risking Milestone.
Before Andrew Ryu brought this, remaining a going concern was a real & present danger.
Cash burn required to sustain DM and build out new AI product lines like SMART were at risk.
Without a doubt, DM procuring CV test-kits was a very timely saving grace for the company , and I Tip my Hat to Andrew for being able to orchestrate it all like he has.
Despite assertions by a basher who likes to point out what they believe is wrong with DM , eluding to the fact that I belong to a small group with very long positions in DM since back in early 2017 and that my bullishness on DM should be subject to scrutiny because I was bullish in the past when fundamentals fell apart, and DM stock tanked, some here can attest and so can Marshall if you ask him, that I was one who made my continued support in DM completely contingent on big change occurring in regard to mistakes made, and I was a big advocate for management change with Marshall at the helm and no reverse splits to occur.
So I’m not just about pump or blind to mis-steps and calling them out.
In my opinion, Marshall and team committed to this taking the tough path less traveled by most micro-caps & electing to roll up their sleeves to dig the company out of this downturn that had DM flirting with crash and burn.
I still remember well, that I was impressed that Marshall shared my opinion that reverse splits is a sign of failure and viewed by many as a way of awarding bad behavior.
Marshall coming from a string of technology managerial successes in his background including his time managing a large technology hedge fund.
He explained the only reason he rose to the challenge of becoming CEO & trying to rebuild DM is because of the intrinsic value/potential he believed lay unrealized in Nexalogy and despite DM becoming so unloved, he thought with tough commitment by all concerned it was possible to bring DM back from the grave:-))
Since that time, I have averaged up to double my position as new milestones have been realized and balance sheet grows.
I continue to be impressed with management execution of staying focused on the core AI enterprise while capitalizing on the bizarre luck that fell on their laps with the Pandemic that I equate to Andrew catching the football and with the help of a solid team, running it for a touchdown and think the TSN Turning Point behind us now & best days for this growth company still lay ahead of us.
We Live in a Age Of the Highest Geopolitical Volatility & StockMarket Volatility in History
Due to Nationalism, Politics, Covid19 Pandemic Outbreak, and the Ponzie-Scheme Fractional Reserve Currency induced Debt Bubble and whatever else THEY have planned for us, like a potential civil war in the US because neither side will accept the outcome or worse , a diversionary war between the US & China
Nonetheless , exactly the #PetrieDish environment required to keep growing and sustaining Fake News , Disinformation & Propaganda.
Some on these bullboards claim the gone are days of being long on a stock,
Based on what I wrote about here, I think DM & a few decently managed precious metal plays will prove to be a exception to this rule, if the company can continue to execute. I see no signs of that stopping as this team appears very driven.
One challenge with DM that I expect will always be present is because many of these AI deals are of a extremely sensitive nature with Gov Defence , i suspect it’s very likely we never see contract announcements with many and scale of contracts could be clouded also in the form of payments on monthly basis.
This coupled with companies ordering DM testing services like some of these mining conglomerates wishing anonymity and DM need for masking their margins for competitive reason, means investors have only financials to guide them outside of AI contracts
It’s my hope that with this in mind , management & Board recognizing the lack of disclosure creating some frustration with investors may reward investors for their patience with a dividend down the road.
I for one, will certainly press for this when the time seems right
Also a buyback could certainly aid management achieving their stated goal of obtaining a #NASDQ or NYSE listing.
Never know, there’s always a chance DM is acquired before any of this happens.
On that note, anyone else happen to notice the timing of DM starting to trade on the OTCQB lands about the same time as PAL intar starts trading late September
(I spelt & split that name up for a reason :-))