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Consensus community valuation
$25.69
Average Intrinsic Value
11.9%
Overvalued by
Active Member Straws
#AI
Last edited 6 months ago

Promoedicus will be showcasing its AI Accelerator solution and breat density classification algorithm at the upcoming Radiologiocal Society of North America in December. (ASX announcement here)

A key aspect of their solution is that it enables integration of 3rd party algorithms through an open API -- which means it has the potential to be the platform for research and application in this fast growing area. I remain convinced that medical images are a perfect candidate for AI processes, and will soon be integral to almost all future diagnosis procedures.

With big name collaborators such as the American College of Radiology, and a fast growing list of industry leading customers, Promedicus is very well placed here.

This area of the business has potential to not only enhance the attractiveness of Promedicus' Visage system, but could open up a new customer set (researchers and developers) and build a potent network effect.

ProMedicus remains one of the most exciting businesses on the ASX, and I remain convinced that it will be a significantly bigger and more profitable company in the decade ahead.

The trouble is, that is well and truly being priced in by the market at present. I retain a modest holding, but am not looking to add at current levels. 

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#HY2020 Results
Added 3 months ago

Yet another cracker.

Revenue up 15.7% despite a large one-off capital sale in the prior half. Margins improved, with net profit up 32% (go operating leverage!)

Operating cash flow jumped strongly, as did the cash balance -- which sits at almost $39m. The company still has no debt.

Implementations are being completed ahead of schedule and without any major issues, and there is plenty of capacity to onboard new customers. 

Sales pipeline is as strong as ever, and the company is getting an increased network and 'social proof' effect due to its high profile client list.

Some super exciting stuff happening in AI, which i've always thought has huge potential. PME is one of the rare ASX companies that can legitimately claim to have direct and high-potential exposure to this theme.

I'd encourage investors to read the Open Briefing interview -- although it's hardly a tough interview, there are some good insights.

I think PME is one of the best stocks on the ASX. The only challenge is one of price -- there's a heck of a lot of optimism priced in. On a trailing 12 months bases, shares are presently on a Price to sales of 55x!! (based on share price of $28.97 at time of writing). The ttm PE is ~140

I previously sold down some of my position mid last year when the price was getting a bit silly, but retain a modest holding. Not looking to buy more anytime soon, but happy to leave existing shares in the bottom drawer -- the sheer degree of quality makes me far more relaxed on valuation than i would normally be.

Results announcement here

 

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#Contract wins
Added 5 months ago

PME has signed a 5 year, $6m (minimum) contract with Nines -- a tele-radiology Palo Alto based software company led by silicon valley veteran David Stavans.

The contract will allow Nines to further develop radiology products based on ProMedicus' Visage 7 platform. Nines has a focus on Machine Learning and AI in developing its cloud based solution.

Seems a good deal that essentially gives PME an entirely new channel. Nines success will be PME's success.

Announcement here

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#Management
Added 2 months ago

Some big insider buys on market announced today (Anthony 41,00 shares and Sam 30,00 all above market price) have finally encouraged me to take a position, knowing that 1. Yes general sentiment in the market could likely bring this down further and 2. The current valuation (even after this huge sell off) is still on the high side. In the short term, new contracts might slow down and we all wait to hear of any news regarding the impact of the pandemic.

 

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#ASX Announcements
Added 3 months ago

13 February 2020

HIGHLIGHTS

  • Revenue $29.3m–up 15.7%
  • Net profit after tax $12.1m–up 32.7%
  • Underlying profit before tax $14.8m–up 45.3%
  • Cash reserves $38.8m–up 20.2%
  • Fully franked interim dividend 6c per share up 71.4%
  • 2key contracts announced during the period
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#price
Last edited 5 months ago

optimisitical price,

a company nice,

software that helps,

doctors and whelps,

I own it I do,

ups and downs through.

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