FYI | Mar 20 2019
By Pitt Street Research
Anteo Diagnostics ((ADO)), a Brisbane-based technology company, is developing a nano-chemistry technology to modify surfaces. The company has streamlined its focus from an initial target segment of the entire life sciences diagnostics and IVD space to specific areas such as the Point of Care (POC, representing a major chunk of IVD industry) and battery segments. The POC segment is a near-term opportunity for Anteo on the back of its more-than-a-decade-old experience in the in vitro diagnostics (IVD) space.
The opportunity in this >US$15bn market is huge due to the demand for nanoscale platforms in POC devices that can bring them head-to-head with lab-scale devices without compromising on advantages related to their ease of use.
We thus believe that Anteo has a tremendous potential to make POC devices more effective. In fact, a few initial collaborations have already proven its potential as large players, such as GSK and QIAGEN, have shown interest in POC devices modified using Anteo’s technology.
Anteo is also evaluating the potential of its technology in the battery segment, which represents a long-term opportunity for the company.
It is currently conducting validation studies in this segment and has secured initial collaborations with battery component suppliers. These agreements represent an opportunity to bring the technology to a broader audience and drive adoption.
Anteo has decided to streamline its focus on high-value opportunities, including POC and batteries. The unmet need in both sectors is tremendously high and Anteo’s technology aims to fulfill it.
We believe Anteo’s strategy to focus on important opportunities first is a great way to utilise its cash. The ongoing collaborations are expected to continue to drive the commercialisation potential of this technology.
Meanwhile, a licensing opportunity in other areas, such as medical devices, would be an added advantage.
We value Anteo at 2.9 cents per share base case and 4.0 cents per share optimistic case using a probability-weighted DCF valuation approach. We see Anteo being re-rated by the market as its Battery project yields highly efficient silicon composite anodes, and as the POC project moves towards commercialisation.
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Earlier today the report above was released by Pitt Street Research for which FNArena is a partner in distribution. The full report can be accessed here: https://www.fnarena.com/index.php/pitt-street-research/ADO/
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