So what is up with POET Technologies? I’ve been following this story for a while and was initially impressed with the offering. Let’s face it; Moore’s Law is pretty well dead when it comes to computing. For the most part advancements have been relegated to look and accessories.
POET Technologies (TSX: V.PTK, Forum) promised to turn the world on its ear with its patented proprietary POET process that would integrate electronic and optical elements onto one chip which would
boost computing performance by a factor of 10 along with energy savings of 90% compared to existing technologies.
I wet my pants considering the potential, perhaps that was too much information, but I was excited by the prospect POET offered. The company has 34 patents with seven more on the hook waiting for approval. There have been some major milestones reached in the company’s bid to bring the POET process to market, involving some heavyweight partnerships, including a global leader in military electronic systems. The all-important documentation for the POET TDK (Technical Design Kit) was published in Q1 2014. When the company announced that it expected delivery of the 40-nm PET Process Design Kits (PDKs) to 3rd party chip developers by the end of that year, I thought POET was ready to crack the semi-conductor market wide open.
That’s when things got a little fuzzy. Investors got a little worried when Chief Scientist, Dr. Geoff Taylor, the brains behind POET, disposed of 300,000 shares. Traders took this move as a sign of non-confidence, although Dr. Taylor was quick to assure investors that he sold for personal financial reasons and had no intention of any further sales until at least 2016. However, the seed of doubt had been sown and even though Dr. Taylor still had skin in the game to the tune of almost 1.0 million shares complete with options, SP took a major hit and slid from $1.21 on October 2, 2014 to $0.72 in the space of a month.
SP began to rebuild in spurts and by the time POET announced that it had completed the 40/100-nm transfer milestone in February, stocks had reached $1.36. Things really began to pick up when the company announced that it had signed a collaboration deal with BAE Systems Microelectronics to accelerate its Lab-to-Fab efforts and successfully demonstrate its disruptive technological process. Still the market was wary and even though April 2015 saw shares at $1.99, it was still a far cry from the $2.50 level POET enjoyed just a year before. That was when the slide began to where it sits today at $1.06. POET has a problem clearly communicating with its investors and the market. Combine this with what some investors feel is a decided lack of progress/missed milestones and you have a PR nightmare.
Blame is being thrown in all sorts of directions, but it mostly lands on Peter Copetti, then interim CEO, Dan DeSimone, CTO, and COO, Stephane Gagnon. Some traders are accusing Copetti and DeSimone of blowing smoke when it came to milestones and potential applications, and these same individuals are hanging Gagnon for being a completely ineffectual COO. An indication that these claims hold water, might be manifest in the fact that the company’s board has raced ahead and placed a new executive at the helm with Dr. Subhash Deshmukh as COO and Dr. Suresh Venkatesan as CEO.
Were Copetti, DeSimone and Gagnon really to blame? Perhaps, but I think there is a larger issue here that involves the transition of IP to production. Typically, it is a different mindset in tech’s formative stages compared to the psychology required when taking a product to market. Sometimes the original crew accomplishes both, but most often it takes another set of individuals to run across the finish line. POET’s process is truly disruptive and if handled correctly will create another tech giant as well as reward investors with an incredible capital appreciation. I’m still in POET’s corner, but I have to admit that the company has painted itself into a corner and in my opinion; it has six months to turn things around and prove that POET is more than just broken promises. Shares were down 4.42% to $1.08 per share.
UrtheCast (TSX: UR, Forum) opened its books today for the Q2 2015. It’s nice to see movement in this Vancouver-based tech firm that is bringing HD images and video of Earth from space to the general population. The idea of extraterrestrial imagery isn’t new, but until now, this sector, due to its incredible expense, was only available to governments and large corporations. UrtheCast, literally beginning in a garage, set out to change all that by creating a system that brought the cost of delivery into the realm of reality without sacrificing the quality of the current multi-billion satellite set ups.
It was a relatively bumpy road as the company sought to place its devices on the Russian side of the International Space Station (“ISS”), but after the logistical and technical issues were ironed out, HD video and imagery began streaming to the company’s earth-bound online platform. UrtheCast isn’t the only one in the sandbox attempting to provide this service to the general public, but it is the only contender that has managed to maintain the utmost quality in its equipment, delivering the world’s first HD full-color videos of London, Boston and Barcelona from its ISS vantage point. This ‘First Light’ footage proved out the company’s ability to democratize the Earth Observation sector.
It was such a notch in the company’s belt that UrtheCast was able to raise $100.0 million to propel itself forward into its next big venture, launching and operating the world’s first commercial SAR and optical 16-satellite constellation that would cover the planet and be able to deliver high quality images regardless of weather. Considering the Theia Medium-Resolution Camera (MRC) has only been filling orders since reaching Initial Operation Capability (IOC) in 2014 and the Ultra HD Iris camera is still slated to achieve IOC some time this summer, it would be fair to state that the company is still in its growth phase.
That said, it is of little surprise that although the books showed significant revenues for the first time of $5.0 million and $8.2 million for the three and six month fiscal 2015 periods respectively, the company still bled red when it came to net income with a $5.7 million loss for the quarter compared to a $4.1 million net loss reported in Q2 2014. However, the company continues to sit pretty with $37.76 million in cash and cash equivalents in Q2, more than doubling the $11.0 million it had in the till in the matching 2014 quarter.
So despite the loss this quarter and in H1 2015 for that matter, it is clear to me that this company continues to build and has the potential to become a major player in the Earth Observation sector with its revolutionary interactive platform. Perhaps today’s dip provides an opportunity for longs. I mean, beyond the endless business and environmental applications,
who wouldn’t want a space-bound snapshot of their backyard birthday BBQ? Shares were down 8.21% to $2.57 per share.
Sepsis is scary, millions die from it every year and the potentially deadly inflammatory reaction to bacterial infection can be found everywhere including a hospital ICU bed. This ‘blood rot’ as termed by Avicenna, has a serious mortality rate with 30-70% of individuals suffering from septic shock succumbing to the effects and dying. In fact, sepsis was the most expensive condition treated in U.S. hospitals in 2011 with an aggregate cost of $20.3 billion per 1.1 million hospitalizations. Spectral Medical (TSX: EDT, Forum), a Toronto-based bio-tech firm, is focused on developing and commercializing a theranostic approach for the treatment of severe sepsis, which currently has a mortality rate of 20-35% in people suffering from it.
The company is in the midst of Phase III clinical trials for its lead drug candidate, Toraymyxin, a therapeutic hemoperfusion device designed to remove circulating endotoxin from the bloodstream, which the company believes will significantly reduce the mortality rate. Spectral is pushing an industry-first with its theranostic approach through the utilization of its Endotoxin Activity Assay (EAA™), the only FDA cleared diagnostic for the measurement of endotoxin, followed by targeted therapy with Toraymyxin. The Euphrates trial, which has been enrolling patients since 2010, is being conducted across the U.S. and Canada and seeks to compare the safety and efficacy of Toraymyxin PMX-20R treatment in patients suffering from septic shock compared those who receive standard medical care alone.
The shares popped over a dollar in April but have been experiencing a slide since which places them $0.67 today. The company, however well-intentioned and how deep it is in its development pipeline is still waiting on FDA approval and there doesn’t seem to be any reliable source noting just when that might be. Although what really seems to be bothering some investors is that the company looks to be under-promoting itself and as a result questions have surfaced asking why the company isn’t pressing for a pre-FDA-ruling NASDAQ listing, why analysts are giving the company a HOLD rating and how come the company isn’t on the roadshow circuit if they expect 2016 commercialization?
This lack of presence and other seemingly strange antics have some traders wondering just what the end game is. I, myself, am confused with Spectral’s approach, but there are many not flustered at all by the lack of promotion, calling the weakened SP/Valuation a result of the typically soft summer market and an opportunity to buy more.
I don’t know on this one. Spectral has gone a fair distance to bringing it’s offering to market and could live up to its post-FDA $2.00 SP, but its current lack of promotion really puzzles me.
Are they hiding something? Shares were down 1.52% to $0.65 per share.