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Good post - many thanks.
This company appears to have a range of products (not just Covid related) and if it fulfills its promise, I agree that it could multi-bag. The proof of the pudding ...
I hold a few.
About the Author
Snowbum
12 comments
gari en desti
Hi Forsby.
Thanks for all the info. I have only invested in Abbott so far, in relation to Covid positive stocks but am looking at some UK stocks too, including Genedrive.
Re Abbott, I have been quite surprised by the underperformance of the share price. After the FDA gave approval for the 15 minute /$5 test and US government announce they were buying 150m of the $5 test in August, I expected this stock to fly, but it did not, in fact it went back down very quickly.
Last week they announced Canada has ordered 20m of the tests and the share price actually went down.
I wonder what this share needs to breakout?
Looking on the US share sites, it shows large recent sells by the management and analyst average target price of $118.
The shares have edged up this week and I nearly sold them but held on, as maybe the Q3 earning release on 14th will put a rocket up this one.
Snowbum
Thanks ricardow, First comment - much appreciated!
I've added a bit more on the Genedrive system with a link to the company presentation. As you say, they also have a very promising prenatal screen coming to market with first mover advantage.
We will see indeed! I think the signs are promising.
Snowbum
Hi gari en desti,
You're welcome. I wonder if it's because the current Abbott LAMP based test doesn't have the specificity required to really be relied on for diagnostic purposes? I think Abbott's test is around 95-96% accurate. It's possibly also why they often talk about getting two or even three negatives in a row over the pond, as I guess then statistically this brings it nearer the 100%.
I think as these LAMP tests improve the specificity, they will be used much more in the future, probably mass gathering scenarios such as football matches, festivals, etc. The specificity of PCR cannot be beaten at the moment I think. That could imply, that as society opens up a bit more, Abbott's fortunes could start to improve?
Armorduck
I hold a few, but have done so for many years since they were called Epistem. I had lost so much value on the share that the fees required to sell would more or less have left me with nothing, so I left them in my portfolio
The Point of Need device has been around for years, originally targeted at TB in the developing world, more recently HCV, but not been particularly successful.
Since Covid the GDR price has increased a lot but I am still down a lot on my purchase price, from about ten years ago.
I understand QPCR (design my own primers and run my now assays) and in my job have purchased Beckman high-throughput liquid handlers. So from my perspective the GDR/Beckman tie up sounds hopeful to me, but Beckman may have similar arrangements with other companies.
Bottom line from me is that one or more companies in this area will probably make a lot of money. I think Roche is at the forefront currently. As a gamble, with a share that was not long ago virtually worthless, I am happy to hold. But I view my holding as a lottery ticket. There are lots of other tickets to buy and I can't judge which might be the winning tickets, so I don't think I will buy any others in this space.
Snowbum
Appreciate your comments Armorduck and agree with much of what you have said. For me, Thermo Fisher Scientific are probably the market leaders alongside Roche. However I also think market conditions, demand, for this technology has changed significantly this year. Perhaps you were ‘early’ with your initial investment?
In his excellent write up on Novacyt Sa (LON:NCYT), Keelan Cooper also highlighted that the global demand was likely to be filled by many players.
I also view this share as a bit of a Covid lottery ticket thus have an appropriate position size, but in these strange times it is possible that there may be quite a few lottery winners sharing the jackpot.
Please note I also have some insight into qPCR design & associated sales through my wife’s job role, unfortunately I cannot say more due to confidentiality agreements.
mort1980
Hi everyone,
It was an interesting article. It would be great if people could compare the product of Genedrive (LON:GDR) with the ones of Novacyt Sa (LON:NCYT) which appear to be already in demand and are generating enough cash within the UK etc. I think this would be the most interesting part and could give us some insight as whether or not Genedrive (LON:GDR) is the next kind of Novacyt Sa (LON:NCYT) (at least in terms of share price)?
All thoughts and comments are welcome and appreciated.
Cheers,
M
Armorduck
Yes Forsby, too early as you say. My Genedrive (LON:GDR) investment is comparatively trivial now, and worth much less than I paid. In terms of opportunity cost. I think I remember that I invested about 4X the amount in Genedrive (LON:GDR), as in £ADBE. They both remain in my portfolio but that latter has done much better!
Snowbum
Hi Mort,
I'm not familiar enough with the lab processes when performing a test to do a direct comparison but a few key takeaways from my searches are shown below:
- NCYT tests can be run on different OM equipment
- NCYT new test also distinguishes between Covid & Flu (Winterplex)
- GDR tests are specific to GDR system
- GDR test method, requires fewer steps requiring less skilled lab workers (ref, lab workflow shown above)
- GDR test plates do not require refrigeration during transport so may suit particular regions; GDR are targeting Indian, African markets etc.
- GDR looking to automate labs via a tie up with Beckmann
In summary, I think both companies are targeting slightly different markets and/or may have a possible niche in particular markets. Therefore, imo there could be room for both to do well.
However, we shouldn't lose sight of the fact there are many other companies worldwide also developing Covid testing protocols, some using PCR, some not...
The first bullet point is the main advantage with NCYT test kits. No need for new instrument purchase.
Choco Rose
It should be noted that NCYT tests are also used in high-throughput settings (Covid-HT designed upon the request of Astrazeneca), though I'm not sure if the same degree of automatisation is involved.
Furthermore, NCYT has also announced that it is working on ready-to-use tests which are coated with reagents.
