The Admedus puzzle

This week marked the third anniversary of my holding in the biotech stock Admedus. I have shared with readers its fluctuating fortunes in this time, striving to present its prospects in as objective a manner as possible. I have taken profits along the way, and am still ahead on my investment, although many shareholders would not have been so fortunate thus far.

The stock-market, to borrow a phrase from former Prime Minister Malcolm Fraser, was never meant to be easy, although it may seem like it when the bulls are rampaging through the streets. The challenge when the bulls retreat, is to hold one’s nerve, and to buy when others are selling in desperation.

The biotech space is usually viewed by professional advisers as too speculative for retail investors, but every now and then small to mid-cap healthcare and pharmaceutical stocks cross the divide into major enterprises and galvanize the sector with fabled gains.

It has been the quality of the medical science and personnel involved in the research that has convinced me to stay with my investment, despite the company’s dependence on capital raisings to fund their expansion and production of CardioCel products.

Today Admedus formally released the half year report ending 31 December 31, 2015. There are no new items of a positive nature to my knowledge. Although Revenue is growing steadily ($6,568,181 for the half) the company continues to report accumulating losses.

  • Loss after Income Tax for 1H 2015-6 was $13,598,520
  • Loss per share 6.94 cents
  • Total assets are $35,914,168, Total Liabilities $3,362,666
  • Net Assets, and total Equity are $32,551,502
  • Cash at end of Half Year is $19,152,186

The market viewed the results negatively today and marked down the share-price to a low of 50 cents. However the figures give no indication of the prospects for growth in the coming year, nor do they take into account the potential for positive results from the Immunotherapy Division in the coming year.

AHZ Dy Feb16

Categories: Chart Review, Company review

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