RE:RE:FirstCADInvestor12 wrote: @ Starkicker/ QC
CEO wasn't complaining or whining about the stock being undervalued, he's saying the stock is undervalued because it is. Don’t forget that the majority of his options have an exercise price of .145/ share, and with the amount of options he owns, he has the best incentive to improve the share price. BV/ share is ~$.12 + SP/ Revenue (@ 1.2x FY23 Rev) ~.09 + value of licenses (yes, the licenses are worth millions) and pharma approval potential.. The catalysts have been shared, focus on profitable revenue, continue to cut unnecessary costs & improve plant utilization, expanded product portfolio in Germany, Australia, & Brazil.
HOPEFULLY there is positive news before earnings and if not, we need specific updates during the call. There is no benefit for Medipharm not to disclose who their pharma partners are, other than not being allowed to disclose them due to NDA's. An announced pharma deal with one of Teva, Apotex, or Sanofi (or like size) would easily double or even triple the share price at current price. Share buybacks are not the answer and won’t drive long term shareholder value. You want to know what does? Continuing to execute on profitable - cost effective growth, and identifying accretive M&A - lots of mismanaged carcasses out there that will add to the top & bottom line and create more value than a buyback. Buybacks should be off the table until they are generating FCF, that being said I’m not opposed to them announcing an NCIB to have available if they see major growth mid quarter.
My expectations for Q2 are: CAD Rec ~$3M + CAD Med ~$3.5M + B2B/ Pharma ~$2M + Int'l Rev ~$4.8M = Q2 total of $13.3M @ 35% to 40% gross margins. I can also see international revenue hitting $10M, but not expecting it. If international rev doesn't increase at least 50% QoQ, then management owes an explanation. Absolute minimum revenue for this to be a successful quarter is $12M (barring HUGE pharma news). Guidance on Q3 & Q4 expectations would be amazing. Next 3 weeks will be painful while we wait. GLTA.
Thoughtful post CAD....and I don't disgree with most of what you're saying. My point on the undervalued comment from Pidduck was that it makes no sense for him to make that statement and then essentially go silent on what the plans to fix that would be. As I said, it comes across as whiney; simply to call out that and then say nothing more.
I fully agree that management owes all shareholders a HECK of a lot more transparency on the financials and where they are going. Pidduck may well have incentive to get the SP up, but a double from here is not good enough IMO. Not a triple either.
I disagree that 'selective' M&A is what is needed here (however one defines selective is up to them of course) as I don't think now is the time to peck at carcasses. All that would do, beyond depleting the treasury and essentially dilute us all, is also add to the OPEX for a number of Qs and give them another excuse for keeping that number high (due to integration costs etc). My view is that we have the arrows in the quiver, now it's time to shoot and hit the target. The carasses will still be there when we are ready and if they're not, they're not.
I base my buyback comment on the basis of their breakeven guidance. Obviously we have a sizable O/S number and using even a fraction of the dollars we have at this rock bottom price could improve that O/S number substantially. That is an immediate and obvious benefit to existing holders and signals to the market that this business means business and is ready for prime time. Tie that to a catalyst of sorts and we have something all of a sudden. Of course if the story we have been told about breakeven etc has been embellished or a lie, then certainly, don't spend the money since we're close enough now to plod along before bleeding out. But IMO, don't use the money for carcass hunting as now is not the time. Get some success and some money and then go and be a weed Biovail for all I care. :) My trading account wouldn't mind that at all. (at least not at their peak of course)
Either way, LABS is long past making hopeful and unsubstantiated comments. Strachan saying yet again that things are strong in <wherever> without the results shpwing it is dead on arrival. I hope analysts take them to task if that's the way it goes.