Novacyt was pitched to the Stockopedia Staff Investment Club (SIC) in early October. On Wednesday (8th October) shares were purchased for the club at the price of £7.24.

Novacyt has been the best performer on the UK market over the past 12 months. The shares have just reached all time highs, and shareholders this time last year have seen an astonishing 10,865% return on their investment.

The momentum has picked up in recent weeks, on the back of transformational financial results and a large contract win with the Department of Health and Social Care (DHSC) in the UK as noted in Jack’s Small Cap Value Report on the day.

Novacyt looks to be a company at the forefront of our fight against the Covid-19 pandemic at the moment, and its impressive set of financial results saw its StockRank soar from 41 to 96 last month, which meant that the company finally met all of our SIC criteria.

As a highly speculative, high flying, mid cap, we will evaluate why we decided to add Novacyt to our SIC holdings, but also what potential risks may lie ahead.

43a0cafeb93c3a9ebd4e77ae469165ca88aa9be51602233505.png

Profile/Category/Style

The company’s name is Novacyt, ticker symbol LON:NCYT and EPA:ALNOV. It is dual-listed and trades on the London AIM market and French Euronext exchanges (share capital currently split 30% UK & 70% France). The company operates in the Healthcare sector, more specifically the Biotechnology & Medical Research industry.

After a stellar year, the shares are trading just off their all time highs, at 762p at the time of writing. The total market capitalisation has just reached £538 million, putting it comfortably in the UK mid cap size group. Liquidity is not a major issue, with an exchange market size (EMS) of 5k meaning that you can invest just over £38,000 (5000 * £7.62).

The stock is categorised as Highly Speculative according to our risk ratings. So potential investors should be wary of share price volatility.

baknkRZMLeU59eAABtma1LCUZQD9iAF8VKkBlm_n5kxSqt8_2VfPXB1apcK_BPqjAZ2FpTaxjnpOrejyuQacpB8OvCA14cptUy1Rc11Bk4EKKP_kKdWuSXUvqXWqUPpkJ_UwP431


What is the opportunity style/type/classification?

Due to the strong price momentum and excellent profitability metrics, Novacyt currently qualifies as a High Flyer. However, whilst the Value Rank may languish behind the high Quality and Momentum Ranks, this might improve in the near future.

Unlock the rest of this Article in 15 seconds

or Unlock with your email

Already have an account?
Login here