RE: nice start eom
Good post Stoocks... I agree with you for the most part but not entirely.
The fact is the company has done a really good job of developing the multiple business platforms that now exist. These platforms give the company necessary diversity. Diversity that is RARE in a company of this size and maturity. There's no argument whatsoever that these things have taken longer than anticipated and have costed more than expected but I think its fair to argue that virtually every platform has developed BETTER than we thought they would 3 years ago...
MacoPharma / PRDT alliance ; Proprietary.. novel... well positioned
Plasma Fractionation program... proprietary... solid contract future
PBI-1402: outstanding preliminary results.. great JV prospects
Enabling business: solid contracts with fortune 500 co's and expanding
Its not terribly difficult to create a cash flow positive company for that sake of a cash flow positive company, you either just cut your R&D or you sell the future. We all have to recognize that its very difficult to fundamentally change the markets adoption pace of new and proprietary technologies.
I would much rather be cash flow neutral to negative for another year if you are doubling or tripling the 2-3 or 4 year income streams via solid contracts. The key is they are SOLID contracts with REAL revenue and royalties... as evidenced by the recent ramp in recurring revenue. Far too often the market pressures companies into a short term focus. I applaud Prometic for not bowing to that pressure despite unforseen delays.
The fact is, we simply havent been able to have it both ways. ie: cash flow positive now and big downstream value. There's no question that management has been overoptimistic in terms of TIMING, but the degree of the opportunity has been well measured.
Ironically, as Ruttan pointed out... this argument may well be moot very shortly because it looks like everything is coming to fruition.
The difference here is, because of managements poor communications and expectation settings, we are not getting anywhere near the value recognition NOW in the market. You are right in that they simply wont be able to argue with cash