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Posted at 20/4/2024 11:57 by harry s truman Plutonian, I wouldn't put too much sway on what the market thinks. Aside from a very few with an interest in the bio sector (like us on this thread) most had never heard of OXB until Boris saw vaccines as a way out of a very bad corner he had backed himself into. Consequently we are much more well known these days, but with the perception of a covid vaccine stock in a post covid era. It's something I'm conflicted about, because whilst the post covid reaction has been a real kicking for OXB shareholders - the money we took in making the vaccine for AZ has carried us through a very bad period when almost everything else we would normally have been doing was halted by the reactions to covid. As it stands, the AZ money got us through covid, but there have been casualties - like our in-house drug pipeline. But if we are honest about it, what had that achieved in the last 10 years besides putting Sio/Axovant out of business? I guess it all comes under the heading of "you win some, you lose some" and life isn't fair or perfect. You know from long experience that my glass is half full, but I've just watched another 6 months of OXB apparently doing very well whilst not really telling us any detail. Yes they have kept that promise to keep us more informed with numbers - and they have done this with sales figures and updating forecasts, but if there have been any names then I can't recall them - which of course leads to our Cluedo theories on here. OXB will update the pipeline on the 29th, and I'm expecting 30 programmes from a year ago, which became 41 programmes 6 months ago, to be at least 50 programmes. If not then how did Oxford end up at capacity? I'm pretty relaxed about calling that one. They seem to be bringing in new work at an astonishing rate - but perhaps that is explained by the fact that (as far as I know) they have never let anybody down - so if you were XYZ Inc and were pinning everything on a new trial drug hope, then who would you put it with? OXB have a great industry reputation for delivering what they promise to do. So I think they are awash with early stage work - some of which will progress to late stage work in time - but if they can win some late stage work of some description too (as per the recent RNS), then that's a huge bonus. My guess for the results is 50+ client programmes. I think they will name some new names from that in a big reveal (as per the precedent set in the interims presentation) but that the rest will remain confidential. I think Stuart's £126 million to £134 million revenue will likely be revised up a little more, and if it's the top number at the end of the year then we breakeven and if it's the lower number then maybe a small loss (remembering that whilst IM are paying for ABL to be updated for our process development work, we are paying for that in Boston - which is obviously a cost). As for what else then there are too many unknowns for us to guess. Of the knowns where there are clues:- We know OXB can call the 20% option early if Homology changes ownership. Will that now happen this year instead of next? Our deal with the worlds biggest vaccine company who likely needs a malaria partner. The contract left open with AZ - for what? They seemed pretty clear that they had seen enough of covid and politicians. The results a year ago where they told us they were expecting to hear something from BMS. The fact that they named a client told me that was something significant as OXB will be expecting to hear from partners about something all the time. Is that still live or has it gone away? Maybe it happened and OXB have just said nothing. They told us at the interims that we are making T-Charge vector for Novartis. That was something which was top secret in 2021, and of course it continues to move steadily forwards until it's either a lot of supply work for us or it fails in trials. There was what we have mentioned with Arcellx for the treatment of relapsed or refractory multiple myeloma. Juno (BMS of course) had adopted our Process C perfusion bioreactor tech for one of their Phase 1 trials. If that works out then of course they will move everything to the best in class system (and everybody else will follow the huge name). Cabaletta are one of our named partners and we know that they have had various permissions granted during the last six months to begin their trials (their news posted on here). Beam had dosed their first patient with BEAM-201. Remember readout is usually pretty quick with CAR-T. Two new adenoviral vector agreements with Oxford University had been signed, including a Clinical Supply Agreement for the manufacture and supply of adenoviral vectors for a vaccine against the Lassa virus, and a second agreement for the supply of adenoviral vector for their programme in Middle East Respiratory Syndrome (MERS) signed post-period. So an update on this maybe too? Will someone else have taken LentiStable besides Orchard? You thought Rocket might be a possibility and that seemed to fit very well in my view too. An awful lot going on here I think. Plus of course what is going to come in through ABL. Read Full Thread Reply
Posted at 07/4/2024 13:10 by cousinit In trying to get a handle on cash I've been looking at the statements made by Homology on their share of OXB Solutions. In the joy of accounting, OXB report the full Solutions result in their Group statements despite being the 80% majority owner. It's not ideal as Homology report current assets for Solutions and the amount they owe them, so you probably end up with largely cash plus biologistics assets WIP/for sale rather than pure cash. OXB report cash separately. Cash and cash equivalents for the OXB Group was £141.3m at Dec 22. Solutions had $39.2m of current assets at the same date and $5.2m owed by Homology. So, if that's assumed as cash, it equates to about £27.2m ((39.2-5.2)@1.25 FX). So OXB ex Solutions c.£114.1m. At June 23, OXB Group cash was £129.4m. Solutions had $15.7m of current assets at the same date and $10.2m owed by Homology. So, if that's assumed as cash, it equates to about £4.4m ((15.7-10.2)@1.25 FX). So OXB ex Solutions c.£125.0m. So cash consumption looks like it was all focused in Solutions. At the end of Dec 23, Solutions has $10.8m of current assets and $3.1m owed from Homology, so around £6.2m of cash ((10.8-3.1)@1.25 FX) so cash burn appears to have slowed markedly (although we know that Homology ceased development in July, so this may have been helped by receiving minimum revenues for not having to do a great deal in return.) Obviously, there is a chance that OXB was moving cash around between the parent and Solutions during the year, but I don't get the impression that was happening (and I would hope that it would have been flagged if it was.) Just on cash, we know that the OXB group cash was £121.4m at end of Aug 23 as that is contained in the going concern statement. It is not clear how much of the $10.2m owed by Homology at end of June to Solutions had been paid by then - Homology say that they aim to pay within 90 days. Appreciate that this is all very spreadsheet-y, but it does suggest that cash burn at Solutions slowed in the second half of 2023 but analysts expect overall cash burn at the OXB group to be much higher in that period. We know the £10m restructuring costs were due to be incurred, but that's almost compensated by Solutions burning less. I've also looked at revenues. Read Full Thread Reply
Posted at 04/4/2024 13:32 by harry s truman Thanks Tuco. I always try to stress somewhere that it's just an opinion, but of late the circumstantial evidence in favour of OXB seems overwhelming. Appreciate I'm bringing coals to Newcastle with these points, but:- What did Institut Merieux see which the market doesn't and why? We have had the OXB explanation that IM basically wanted to build a mini French OXB before eventually deciding that "if you can't beat them, join them", but even so... There is some "factor X" here with OXB which we take for granted but IM find compelling. Whether that was discovered through Roch, or Frank or Seb (who are of course French), or by IM's own surveillance, I guess we will never know, but if you look at the deal IM offered exclusively to us, then it's pretty much unprecedented. They offered us Transgene's old manufacturing plant and labs in Strasbourg, along with the existing orderbook, and also the ABL labs in Lyon, again with their existing order book / workload, for 15m euros worth of shares printed at more than twice the market price at the time of issue (worth 6 million euros?). On top of that they are injecting 10m euro cash into ABL to ease it into exactly what OXB want to use the facilities for without costing OXB anything? In a nutshell they have seen "factor X" which convinced them to give us something quite valuable for virtually nothing in exchange for becoming part of the OXB family. Accept that and Institut Merieux who are very old hands in this business can obviously see something which the market doesn't yet see. What the market does see (and this wasn't public before the IM approach and therefore can't have influenced them) is Seb's sales team selling work at such a pace that (certainly for early stage work) if it wasn't for Boston and the new ABL facilities then we would have to be either giving very long delivery lead times now or just turning work down - which is not normal or reflective of reported market conditions elsewhere. OK, countering this we seem to have daily news stories now that the London Stock Exchange is finished, but regardless of how true that eventually turns out to be, you wouldn't expect it to undervalue a particular company because of where it is listed - especially as we have shares sold OTC on other exchanges - like OXB.DF in the US (and also have very supportive US analysts like Joe at HCW). Time and time again I come back to the same point which is this combination of OXB being seen as a pandemic vaccine stock / being under the radar as a smallcap / being too difficult to understand / having evolved or reinvented itself too many times. When you couple all that with the fact that they will soon announce a very big loss for last year in the same presentation which they will forecast breakeven (hopefully better) for this year, then you can sort of understand the very sceptical approach from the likes of Numis, which is of course "OK, but we'll wait and see thanks". 9 covering brokers on OXB's website. I think I'm correct in saying that only one has revised based upon recent events, with the rest waiting for the FY results presentation before crunching the numbers and revisiting. If that presentation achieves what we hope then all the analysts should up their targets so that the consensus moves much closer to RBC's figure, because at the moment that 180p target from the low analyst and 5 of the covering 9 rating OXB only as "hold" is doing us no favours at all. Read Full Thread Reply
Posted at 04/4/2024 11:09 by harry s truman As brief as I ever can be here, I honestly think that OXB is one of those shares which is too difficult for most laypeople to get their heads around. So, if you are a steelmaker or a goldminer or a telecoms company or a clothes retailer, then the market can compartmentalise you very quickly, there will be lots of analysts who understand your business really well, the investors can associate your business with what you do, and it goes on. As our current CEO says (remember, this is a 60+ year old very successful CDMO exec), he wasn't really aware of OXB until the pandemic. If that's true of an industry insider, then what OXB did (did very well, but that's sort of irrelevant) was so niche that very few people had even heard of them, let alone understood their business - until the pandemic, which even then actually gave them a "name" for doing something else other than their speciality. Up until May 2013 OXB is a biotech company. Primarily gene delivery. Very difficult to value a portfolio of research and trial drugs for such a specialised area. May 2013 until the end of 2023, OXB is this almost unique hybrid company which was biotech drug development for our own drugs + service provider for the likes of Orchard, Novartis, BMS, etc., which totalled 25 as of the interims last year. Really difficult to find another company like that to compare to (biotech research / drug discovery in gene delivery for themselves + CDMO service provider for 25+ others). In less words, there are many CDMOs to compare to and a huge number of biotech companies, but if anyone can find a gene delivery biotech company which is also a CDMO then I'll give them today's spot prize. So what do they compare to? From the end of 2023 onwards OXB is no longer biotech and has stopped the development spend on its own in house drugs, so is now a pure play CDMO which should be much easier for the market to understand. The trouble with the last point here is that the other CDMOs we can all name (Lonza, TF, Samsung, Catalent, Charles River, etc.) all have wide portfolios. By that I mean they make biologics, small molecule, tablets, anything which they can make money producing, and usually tagged onto the end of that business is a CGT (cell and gene therapy division) which does viral vectors and such (like OXB). OXB is a pure play CGT CDMO, which as some of you will remember from a recent webcast, Seb seemed to imply is only us. So yet again, albeit unintentionally, OXB might have ended up in a position where the market is looking for something to compare against and struggling. I think this is our major issue - under the radar and too difficult to understand. The pure play CGT will either be a blessing or a curse. If it works out well then the gearing will be amazing as our whole business is tied to a market which is predicted to explode and OXB themselves say they see 1,600+ potential customers. Should that market prediction go the way of the nuclear powered vacuum cleaner then obviously it wouldn't be as good, but what is the likelihood? On just one drug we provide an essential vector for, over 6,000 people have already received the cancer treatment for a disease stage which was previously untreatable. That market is here now. In the past I've mentioned many times a rough / rule of thumb sector average for CDMO of 5.5x sales as a company valuation. It's not perfect, just a ballpark, but on the "low end" £126m forecast for this year, OXB should be around £700m or 70p per share. On the high end of the forecast £134m would be as near as doesn't matter to RBC's mid 12 month target of 740p. I heard the other day that someone had now put out 770p, but I don't know who that is. This year the analysts have to start valuing us as a CDMO. The new problem (for the analysts) as I mention above, is that the sector average covers companies making everything from over the counter drugs costing a few pounds to million dollar personalised treatments. It's an average, but CGT should be weighted higher. As it stands today, with a £200m market cap OXB is trading on 1.5x this year's forecast sales. There's obviously something very wrong with the rating there. Personally I think OXB eventually ends up much more than the sector average, simply because of the speciality (and forecast need) of what they do very well. For the moment though, we remain under the radar, ill understood outside of our industry / customers, and still labelled as a pandemic stock (post pandemic). I'm hopeful that 4 weeks on Monday OXB kill that perception. It will be the first time Stuart talks about 2025. They will stress that the drug discovery business ended with the 2023 loss. The coverage of the results will be of a CDMO company with a good forecast for 2024. So, the argument against any biotech is always "jam tomorrow" (good results at the end of the next / current trial). OXB are not a biotech company any more. They are a pure play CGT CDMO and will give forecasts for this year and next. Next being record revenue which will beat the pandemic vaccine revenues which were quoted by everyone as being exceptional. I can't see them paying a dividend until the loan is repaid and the last 20% in Boston is ours. At that point then I guess it's on the cards, but if you look at Lonza then it's not a big dividend. If OXB pull in the numbers which they are projecting (over £300m by 2027) and if the multiple placed on OXB by the market reflects them being pure CGT in that market, then I don't think anyone sat on those shares would mind the lack of dividend. Read Full Thread Reply
Posted at 18/3/2024 16:44 by harry s truman Someone once wrote that free advice is worth what you pay for it. Even if you particularly warm to someone, then the old Russian proverb of trust but verify is very good advice. I always try to make sure that people realise it's an opinion, and usually I mention the what's and where's that make up a post, but it still is an opinion. To my mind worth 100x the "going bust soon" one-liners, but then again I am biased towards me. I was neither salesman nor scientist and have said many times that my interest here is layman's level. I don't follow ONT, and as you will have no doubt worked out I don't do this with my other shares. I'll also never do it again when the day comes that I'm out of OXB (long made little promise to myself about that one). Amongst other things I hold SCLP, which reminds me very much of early days OXB in that they have cancer drugs which will work alongside the current gold standard, much as TroVax would have done for OXB had it been successful. Absolutely enormous market should that work out well with drug approvals - almost unlimited upside - but of course there is the risk. OXB these days as a service provider, where our customers stand those risks of drug development is something which has grown on me progressively and I now like very much. Had we stayed pure drug development then none of us would be here now as OXB would have run out of steam years ago. The hybrid system (of CDMO work for Novartis) which became pure CDMO at the end of last year was something I never imagined when I bought in for a cancer vaccine and some gene delivery vectors. An example of my foresight there (or lack of it). Who saw covid coming? If you had told me that the UK would ever have turned to as close to martial law as doesn't matter for a chest infection of little danger to anyone without serious comorbidities, then I would never have believed you. But it happened. The vaccine work was a blessing and a curse. A blessing in that it gave us a lot of money (87% of our bioprocessing earnings) when our other work dropped away - and without that then it would have been very bad for OXB. But also a curse in that when the vaccine work ended earlier than Pfizer or Moderna, OXB (which likely had been unknown to most covid driven shareholders pre-pandemic) was dumped. Fortunately they had the covid vaccine cash pile, but we all know where the selling led us. The work is back now and most days there is another clue. Like this job ad today Sounds very positive on the description, and then you see that they also want 2 of them. For? And there we have it. I think now, and as I have said / done many times before in the past, perhaps best for us all to step back and wait. In this example enjoy spring, but just wait for news. We can't do anything about the ups / downs and if someone has to sell then they will. It only really matters if you are a trader. If OXB continue to keep us updated (as they have done recently - and very well) then as long as they hit what they have guided so far, I'm expecting 3x to 4x our current level by Q4. If not then we will be bought by someone who does believe it. We have insiders now who must know much better than this how it's all going, so it will be interesting to see what happens in that little open period following the results. That would be a brilliant sign for us. Read Full Thread Reply
Posted at 18/3/2024 11:57 by harry s truman 5.5x sales isn't a model Brucie, it's just a historic sector average of what a CDMO company should trade on - so a very rough guide. There is a progressively more accurate way to gauge, involving EV and such, but when OXB's value is so low, does that even matter? No, it's just a comparison. In a similar way using a sector average for CDMO is only very approximate as a lot of people in CDMO are making generic otc medicines which there is only money in on huge volumes. CGT is far more lucrative and so the rating can (with some justification be double the average) - but you don't see me do that do you?. It's like the breakeven figure for OXB, or the amount they need to sell to cover their costs, and OXB have told you previously everything you need to know to have a good stab at working that out. You know that c£90m last year wasn't enough, but you can't look at the loss because some of that was for other stuff besides operations (capex on expansion in the US, £10m on redundancies and such), but you can remember that OXB said that on 130% of c£90m OXB would be broadly breakeven this year. Since then the ball has rolled on, but ABL was said to be neutral in its pre-OXB life and our growth is now up another 5%. In the simplest terms though, last September OXB told you that c£117m (c£90m x 1.3) would be broadly breakeven this year and a fortnight ago they told you that this year is now projected to be a FY2024 revenue range of £126 million to £134 million. They really have showered us with detailed news of late, which is there for anyone who wants to look. Yes there will be costs to bring ABL into the OXB family, but IM are paying those - and are apparently very happy to do so. If, (if, if, if) the margin on c£117m in sales covers OXB's wage bill, leases, interest payments, utility charges and everything else this year, then what they sell above that is basically margin to the bottom line less raw material costs, consumables, packing, logistics and such - isn't it? But what I have written there isn't new or news - we have known an evolving story since September that they are selling an unprecedented amount of work. At each update that has got better. I might have to wait until after the interims and I might not, but personally I'm convinced that barring some exceptional negative event, OXB will be back in the FTSE250 this year. I think though that we've all set our stalls out now though, and that nothing we type here changes anything anyway - so perhaps the best policy is to wait for news now, whether that be on the 29th of April or before. Read Full Thread Reply
Posted at 11/3/2024 21:03 by harry s truman We've done the cash position a lot Brucie. £103.7m cash - c£40m loan - c£20m put option + c£17m from IM for new shares + whatever else comes our way this year. Nett cash is brilliant assuming that OXB hit their guidance of rough breakeven (or better). Redwing, I type what I think as an OXB watcher and usually caveat that somewhere. It's an opinion from a non-expert non-city type. Maybe you know story well, apologies for the quick repeat if you do, but OXB were doing well before covid. CAR-T and a lot of other good stuff had lined up for them. Then came covid and clinical trials stopped (apart from covid related) and stuffed many of OXB's customers. We got vaccine work but when that ended early for political reasons a lot of our pre-pandemic work hadn't come back and we had 2 years where but for the huge cash balance we would have been stuffed too. Read the recent releases and OXB's current situation is that not only is the work back now, but Seb's sales team is winning such an amount of work that we are already surpassing all pre-covid years and of course we wouldn't be sending excess work to America if Oxford wasn't at capacity. Even on RBC's current assessment of OXB's public targets, so basically RBC being conservative about OXB's "achievable" guidance (i.e. effectively 2 cautious discounts applied there), their future is very bright (740p target this year). Listen to Stuart in the webcasts last year about the guidance where he says 3 year revenue CAGR better than 30%, EBITDA margin better than 20%. But he stresses that these are very achievable targets which they expect to better. What did he say in the update last week? Three-year revenue CAGR increased to more than 35%, up from prior guidance of more than 30%. Expect to better 30% becomes more than 35% in six months? Just my opinion here but based upon the above I honestly believe that OXB are in a position now where they are looking at the amount of work Seb's team is winning and thinking "this is brilliant, but after the last 2 years if we give projected guidance for the full story straight away then they'll never believe us". So they are dripping it out in incremental stages (as shown above) and people like yourself are still thinking that it's too good to be true - which is fair enough. Stuart says roughly breakeven for OXB this year, but there are of course many things lurking which could make that guidance redundant too. Just another bit about the new house broker. RBC in their note last week have that revised target of 740p for this year, and of course you perhaps already know their 3 year fair value of £18, with both actually being discounted figures to reflect RBCs caution that OXB can achieve what they have guided for this year. RBC say that they will revise upwards as we progress through the year if and when OXB demonstrate that they are hitting their targets. Their upside scenario for this year is significantly more than 740p and the upside target simply represents OXB delivering on everything the guidance in their public plan targets. OXB have said this is very achievable and they expect to better it. I'm actually much more optimistic about the future than I might come across (yes, really). I also believe that OXB after the last interim results that, without the optimistic future plan + ABL deal, would have been simply been seen as missed previous guidance, are now giving guidance which is definitely not going to become another missed target - i.e. it's expectation over hope. But what if some of the big hopes come in? I guess that's a different topic. At the moment RBC are showing professional conservatism and I like that. I like it even more that their idea of conservatism is a target price of 740p this year. In the absence of any other news, the presentation on the 29th April should show another 2 months of progress. Read Full Thread Reply
Posted at 07/3/2024 20:59 by harry s truman I appreciate that, but I'm not really sure how it all happened. I want to think that an earlier thread formed the habit because there were a lot of good sorts around (even doc - our arch nemesis - was positive back then) but as you will have worked out I don't do this with my other shares. Could simply be the time invested too (rather than the money). I suppose everybody needs a hobby. Anybody still around from the early days (and there are a few) I think we all have a very realistic view about our shares bought back then. I never owned OXB when they were AIM (that is before me) but I'm pretty sure they were floated at 100p and ended up higher when they joined the main exchange. Since then it's been a bit of a rollercoaster, but remember the 50 to 1 consolidation? I have great optimism for the future of OXB and by that I don't mean the revenue or earnings which they have forecast for 2026. Some of this revolves around the people who have come to OXB. Frank is 61 or 62 and had a brilliant job as CEO of Rentschler Biopharma (large private CDMO). They liked him and he has stayed on as a director there, so what is the logic for a guy nearing retirement to leave an excellent position for the same role in a UK company which had been severely battered post-covid. I think we can discount both weather and food as attractions for a Frenchman, so why did he choose to come / what was the attraction? I suspect not the money as 6 or 7 years as CEO of Rentschler will have him extremely comfortable already. So why come? And then Mark (our new US site boss) previously Vice President, Site Head for CDMO Rentschler Biopharma. No prizes for guessing how Frank knew what he could do, but again - left a good job to come to us? Seb was VP CDMO for Merck and Thierry a similar very good job with Merck. These guys all have great CVs / track records and yet they came to a company where if they looked at the losses before they came, or the share price chart? The only thing which makes sense to me is that Frank wants to go into his eventual retirement on the back of creating something rather special and OXB is his chosen vehicle. Seb Joined before Frank, but Frank brought the other two in and these guys all know how to do this (make millions in successful CDMO). The fact that Seb, Frank and Thierry are all native French speakers is invaluable for how ABL develops - and there is a huge amount of potential there. Mark in the US has a facility roughly the size of OxBox, so with similar potential. Frank's job is to now make sure everything OXB owns pays for itself and I think he's already made a very good start. You will have seen me before mention our three 1,000 litre bioreactors in Oxford (we have many more smaller), there are three 500 litre bioreactors in Boston, three 200 litre bioreactors in Lyon and one in Strasbourg. Ignoring all the smaller equipment for process development and pilot scale work (which as we know is very busy) that's an awful lot of capacity for volume production which at the moment has demand nowhere near capacity. I'm certain that will be somewhere near the top (if not the top) of Frank's to do list. Get the downstream side of OXB at anything near the current utilisation of our process development / upstream equipment and I think you would be surprised at what OXB can earn. 1,000 litre bioreactors bought for covid vaccine bulk production are probably never going to be used in CGT CDMO work, but they are ideal for mass production of another vaccine. In time we will discover the plan, but using those again could be such a big earner. Read Full Thread Reply
Posted at 06/3/2024 15:23 by harry s truman Philly, The notes are for private clients of RBC or similar people (I am neither). If you search on "Oxford Biomedica RBC" then lots of the financial websites (morning star and such) listed a revised RBC target of 740p for OXB yesterday. Certain of the the notes you can buy from websites like Zacks, but not the RBC note. I'd reassure you here that there are no market sensitive secrets in any of them, it's just an opinion based upon a chat with OXB's management. For the ordinary PI then imho they are reassuring but not really relevant. For a professional then it saves a lot of time to pay someone else for some collated information. The long term targets aren't really forecasts, they are just a suggestion of what fair value would be if OXB's 3 year plan (as described to us too) works out. So (to give one example) at the moment we are doing a lot of early stage work. Some of that will come to nothing, either because in early trials the idea just doesn't work or because the customer decides it's too big of a risk or any number of reasons. But, a percentage of our early stage customers will progress to become later stage customers which means more work of a different kind and more money. Nobody really knows what that percentage is. So there is a guess based upon experience / industry knowledge that xx% of them will progress to later stage work and that is where the future 1,800p fair value comes from. If that assumed percentage progresses to later stage and early stage remains at capacity with new demand then 1,800p. If the percentage progressing to the next stage is less than assumed and demand for early stage wanes, then it will be less than 1,800p if the actual percentage is higher and early stage demand remains high then it will be more than 1,800p. Nobody knows how that will turn out yet, though we have all seen press stories predicting future market sizes for gene therapy. This is very much a pay your money / take your choice type deal - and remember that one of the brokers (I think Liberium) actually has a 12 month target price of less than today. I suspect some of these people are not going to be convinced until OXB posts H1 results to prove their worth sometime in September. I've watched OXB drop after good news many times before and so it wouldn't surprise me if it happens again over the next few weeks. A base value for OXB as a CDMO should be 5.5x revenue. Important to note that's not how much work they can sell in a year, more what they can complete and bill for - so, to take last year they sold £131m of work but invoiced c£90m within the year. £90m x 5.5 = £495m. There are roughly 100m shares so a fair price should have been at least 495p, which it was for a lot of last year until some US funds started selling in August (from which we have yet to recover). In the RNS yesterday OXB said their projected revenue for 2024 (so not might or possibly, but expected) will be in the range of £126 million to £134 million. Same 5.5x multiple would be a market cap of £693m to £737m. £737m market cap / 99,957,395 shares is as near to 740p as doesn't matter, but I'm sure RBC put more effort into their target than that. I've waited a long time and I can continue to do so. The big worry seems to be that OXB will get bought out cheaply, but my opinion is that NN, Vulpes, Serum and now IM would just say no. With all those shares out of the equation then it's probably a non-starter and I'm sure predator companies will have looked. Of more interest to me is not the reassurance of what OXB have now told us, it's more what they "might" do (basically all the guesses in the post above and much more which we can't guess at). OXB have three 1,000 litre bioreactors in Oxford which were bought at a cost of millions for the covid vaccine work which then paid for them many times over. Since covid they have seemingly done nothing. If OXB can find a post-covid use for those then the scale of what they would produce makes them very lucrative pieces of equipment, even if the unit / dose cost of what they produce is very low. An example there of why a 3 year target isn't really a target - too much can happen to change it. Here and now though, we have started a year very well which OXB are confident will be a good one. For us now, it's wait for the next news - which is expected end of April (Monday 29th) but might be before with something unexpected. Read Full Thread Reply
Posted at 27/2/2024 13:29 by harry s truman Steeplejack, I honestly don't think we have much common ground. I came to that conclusion long ago with the amount of time you spent on badger's thread. You might think that's an unfair thing to write, but those of us here for any amount of time remember badger spamming the OXB thread to get people into HEMO. Once he was presumably out of HEMO and the price collapsed, he was on the HEMO threads mocking those left in. So, although I'm perhaps guilty of judging by association here, most of us seemed to have worked out that badger is of low character, many aliases and means well for no one except himself. Best not humoured, though he is I believe a coal mine expert now. Anyway, he left his thread (of doom but no actual bad news) and you are here now. Today's problem (for you and so far 3 others) seems to be the obstacle of how OXB can return to the price they were in March 2023 (almost 12 months ago) before the price dropped on no bad news about OXB and didn't rise again on £124m worth of new work won as of early December. So, by all means continue with the pantomime chorus of "oh no they can't" without ever (to my recollection) outlining an obvious problem with OXB, but I'm sort of done now with the "oh yes they can" reply. I appreciate you have lost hope in the LSE and would prefer to see OXB as a tiny fish in a much more vicious US pond. That one has me less than convinced. We also have this ongoing comparison to Moderna, where the only commonality is that both saw the boom / bust of being covid stocks, but other than that Moderna as a mega pharmaceutical company has nothing in common with the biotech / now CDMO which is OXB. So I feel we are at this impasse now and yet again I'm reminded that since badger became a natural resources expert this is now often what is basically a surrogate bear thread. If in the future you have got anything which actually relates directly to OXB then I'll give it a go, but right now I'm quite tired of problems with OXB which we can't quite put our finger on (which does seem to be a popular view). Read Full Thread Reply