\u2018Big pay day\u2019 for Prescient Therapeutics, says Pitt Street
\nAerometrex to benefit from the seismic shifts of Artificial Intelligence<\/p>\n
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Pitt Street Research<\/strong> has sent us its thesis on biotech stock, Prescient Therapeutics (ASX:PTX)<\/a><\/strong>, with a valuation range of 11.6c (bear case) to 16.3c per share (bull case)<\/strong>. PTX closed at 6.8c on Friday.<\/p>\n Prescient is a Melbourne-based drug\u00a0 developer focused on cancer, with several platforms and\u00a0 products in its portfolio.<\/p>\n The company\u2019s lead\u00a0 compound is a small molecule called PTX-100<\/strong>, which is\u00a0 potentially a significant future treatment for T-Cell\u00a0 Lymphoma.<\/strong><\/p>\n The company also has two cell therapy\u00a0 platform technologies: OmniCAR<\/strong>, which allows next generation CAR-T (Chimeric Antigen Receptor T-cell\u00a0 therapy) products to be developed, and CellPryme<\/strong>, which\u00a0 allows enhances adoptive cell therapy performance.<\/p>\n Pitt Street believes that a big payday might be coming soon with PTX-100, which already has an Orphan Drug Designation<\/em> from the US FDA<\/strong> for all T-Cell Lymphomas, and\u00a0 is currently in a Phase 1 trial.<\/p>\n \u201cThere is potential for this\u00a0 product to gain FDA approval after Phase 2, given the\u00a0 current lack of treatment options for T-Cell Lymphomas,\u201d said the note from Pitt Street.<\/p>\n The drug also has multiple future indications, and there is potential for it to work against myeloma, breast cancer and pancreatic\u00a0 cancer.<\/p>\n As such, Pitt Street now believes the market is seriously undervaluing a potential near-term\u00a0 payday with PTX-100.<\/p>\n \u201cPrescient has market capitalisation on the ASX\u00a0 of $50m, and we think that does not begin to take account of\u00a0 the way in which clinical success with PTX-100 in T-Cell Lymphoma can yield a\u00a0 marketed drug in only around three years \u2013 where that drug\u2019s market opportunity is at least in the hundreds of millions.\u201d<\/p>\n Meanwhile, Prescient\u2019s CellPryme platform could make the cells in cellular\u00a0 therapies more \u2018youthful\u2019 (CellPryme-M), as well as overcome a\u00a0 suppressive tumour microenvironment (CellPryme-A).<\/p>\n \u201cThis allows a\u00a0 relatively rapid path to commercialisation given the many cellular\u00a0 therapy products now in the clinic,\u201d said Pitt Street.<\/p>\n Prescient\u2019s OmniCAR platform, in the meantime, allows next generation CAR-T.<\/p>\n \u201cConventional CAR-T has been highly successful, both clinically and\u00a0 commercially, but Prescient\u2019s OmniCAR platform, by allowing\u00a0 controllable T-cell activity and multiantigen targeting with a single cell\u00a0 product, can potentially take the CAR-T field to the next level,\u201d noted the broker.<\/p>\n \u201cWe value Prescient at 11.6 cents in our base case and 16.3 cents in our optimistic case.<\/p>\n \u201cWe see\u00a0 Prescient re-rating as it continues to generate good clinical data from\u00a0 assets in the pipeline and move towards eventual commercialisation.<\/p>\n \u201cWe also see upside potential as products from the OmniCAR platform\u00a0 moves towards being studied in clinical trials,\u201d said the note Pitt Street.<\/p>\n \u00a0<\/p>\n Sequoia<\/strong> has initiated coverage on Aerometrex (ASX:AMX)<\/a><\/strong>, with a price target of 40c<\/strong> (versus current price of 30c).<\/p>\n Aerometrex provides geospatial services to a broad range of users in Australia and elsewhere, including 2D and 3D mapping and LiDAR surveys.<\/p>\n These services are used in an expanding range of situations including urban planning, environmental management, resources management, real estate and property development, defence and security, and even archaeology.<\/p>\n Read more: How Aerometrex (ASX:AMX) is helping lead ASX stocks into the Metaverse<\/a><\/strong><\/em><\/p>\n Sequoia believes the industry has a strong outlook, estimated to have a minimum value of US$5 billion and is growing at sustained double-digit pace.<\/p>\n \u201cThe use case for mapping data continues to expand with lower costs, higher quality data and image capture, and more sophisticated processing algorithms, especially when combined with other data sources,\u201d said the broker.<\/p>\n This pattern will continue as AI (artificial intelligence)<\/strong> and ML (machine learning)<\/strong> begin to impact the industry, Sequoia added.<\/p>\n Since listing in 2020, Aerometrex has transformed its business profile from being overwhelmingly based on project work, to where a substantial and fastest growing part of the business is from recurring subscription-based revenu<\/strong>e.<\/p>\n While the LiDAR (Light Detection and Ranging) projects are where the company has significant and sustainable competitive advantage, Sequoia believes its 3D mapping and modelling business is where the \u201cblue sky\u201d opportunity lies.<\/p>\n \u201cThis is is a sector where AI and ML are likely to have a major impact as a growth driver. With sales to Google and EA Sports, Aerometrex has demonstrated its ability to deliver high quality products to global scale, high profile users,\u201d said the broker.<\/p>\n Aerometrex has been generating positive EBITDA for at least the past six years, but has yet to breakthrough to profitability as the company has burned through cash each year.<\/p>\n \u201cWe estimate that the breakeven point lies in the revenue range of $45 million and $60 million, which is still well ahead of the FY23 level of $25 million.<\/p>\n \u201cNonetheless, this gap is narrowing, and we are forecasting revenue and EBITDA growth of 15.5% and 15.0% in FY24, and 17.1% and 15.9% respectively in FY25, with revenue reaching $34 million in FY25.<\/p>\n \u201cThe cash burn is also expected to considerably narrow over the next two years.<\/p>\n \u201cAlthough there is still some way to go before the company achieves its profit breakthrough objective, the key valuation drivers are very positive,\u201d said Sequoia.<\/p>\n \u00a0<\/p>\n \ufeff<\/span><\/span><\/p>\n \u00a0<\/p>\n The views, information, or opinions expressed in the interview in this article are solely those of the interviewee and do not represent the views of Stockhead.<\/em><\/p>\n Stockhead has not provided, endorsed or otherwise assumed responsibility for any financial product advice contained in this article.<\/em><\/p>\n <\/span><\/p>\n The post MoneyTalks: Prescient set for \u2018big pay day\u2019; Aerometrex to grab \u2018blue ocean\u2019 AI opportunity<\/a> appeared first on Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"Aerometrex\u2019s \u2018Blue Ocean\u2019 opportunity<\/h2>\n
Prescient and Aerometrex share prices today:<\/h2>\n\n