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Omega Diagnostics (ODX)

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WickedLester
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Omega Diagnostics (ODX)

#104689

Postby WickedLester » December 17th, 2017, 11:45 am

I have a small investment in this company and think they have great prospects in the medium term.

They published their interims on Thursday and clearly the market was not impressed and the shares fell 25% but I believe this has now produced a good buying opportunity.

The market cap has fallen to about £20m which does not imo reflect the very real value in the shares and the prospects for growth with the introduction of new products close to being achieved.

They describe themselves as:

Omega is one of the UK's leading companies in the fast growing area of food intolerance testing and also operates in markets supplying tests for allergies and autoimmune diseases and specific infectious diseases through a strong distribution network in over 100 countries.

They have three operating segments: Allergy and autoimmune, Food intolerance and infectious diseases.

Only Food intolerance is currently profitable and makes an operating profit of approx £3m per year although from the results outlook i'm not sure whether this is going to be a bit lower this year. I believe this segment is worth at least the market cap on its own.

Then there is Infectious diseases. They have recently finally CE marked their CD4 test for HIV and this means they have overcome the technical hurdles they faced developing this and can finally start selling it. I have seen forecasts of £10m revenue a year once they have all necessary regulatory approvals and the product is fully in the marketplace.

They also have Allergen tests which they are developing and are currently in talks with IDH over the terms of the distribution agreement which have been going on for some time.

THe balance sheet is pretty strong with net cash although they are currently consuming cash as they develop their new products.

So in short I believe this business to be cheap just on the profits from Food Intolerance with nothing in the price for the very real prospects for CD4 which is now close to being out in the market.

Lester

WickedLester
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Re: Omega Diagnostics (ODX)

#131275

Postby WickedLester » April 10th, 2018, 7:19 pm

I'm beginning to think that posting here is the kiss of death for me.

This announcement was made today and the price has fallen a further 30%.

https://www.investegate.co.uk/omega-dia ... 00033356K/

I'm not sure whether this is simply a rudderless ship or whether the major shareholders are pushing for a breakup. It's interesting that Chris Mills has a notifiable stake.

There is a chance that they will need to raise yet more cash as headroom is getting slim, although they currently have little debt.

The fall in Food Intolerance sales is worrying although not completely unexpected. I originally got into these as I felt this business was worth the market cap with two blue sky opportunities in the price for free. Indeed it may be that that opinion is not shot yet if the board are to be believed.

The need to demonstrate and crystallise value for shareholders over the short to medium term. There is a recognition of the challenges associated with this given the Board's belief that the sum of the individual parts at present may be substantially greater than the perceived value of the whole.

I'm certainly not selling on this news, but i'm not sure I can bring myself to throw more money at them.

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Re: Omega Diagnostics (ODX)

#275090

Postby WickedLester » January 4th, 2020, 11:37 am

I've been steadily buying these at around 11p and it is now my largest investment.

I'm looking for a sale of the Food Intolerance business for north of £30m in the new year and if rumour is to be believed there is some interest in it.

Also CD4 is now out in the market and there are orders for 300,000 units from Nigeria dependant on the Ministry of Health including it in its AIDS programme, approval of which is expected imminently. Breakeven for this division is 500,000 to 700,000 units pa.

The Allergy business is developing slowly but may be worth a bit also in a few years time.

All in all I reckon these will end up being worth 30-50p a share in time.

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Re: Omega Diagnostics (ODX)

#278230

Postby WickedLester » January 17th, 2020, 7:00 pm

Today ODX have announced that they have received approval for their CD4 test from the Nigerian MOH and can now start shipping the 250,000 tests they have on order.

https://www.investegate.co.uk/omega-dia ... 30041757A/

I believe this is just the start for this test and once WHO approval is gained then it opens the door for NGO's to start using the test in HIV afflicted countries all around the world.

Even at this price I believe the Food Intolerance business is worth the market cap on its own with this new business which appears to have great prospects and Allergy thrown in for free.

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Re: Omega Diagnostics (ODX)

#299156

Postby WickedLester » April 9th, 2020, 7:33 am

I believe this stock to be significantly undervalued and it is my largest investment.

There has been plenty of news out of the company recently, all of it good.

Firstly they are unaffected by COVID-19

https://www.investegate.co.uk/omega-dia ... 00034747I/

Secondly they have received Chinese approval for their food detective tests. This could double turnover at their Food Intolerance division.

https://www.investegate.co.uk/omega-dia ... 00034755I/

Thirdly a promising result from a Médecins Sans Frontiéres test of their CD$ advanced disease test. This is a new test and they are targetting sales of 5-6m units a year at $5 a test and 60% gross margins.

https://www.investegate.co.uk/omega-dia ... 30018791I/

And finally today a MOU for a collaboration on a lateral flow test for COVID-19.

https://uk.advfn.com/stock-market/londo ... O/82200192

I believe the Food Intolerance division alone is worth twice the market cap with all of the other businesses thrown in for free.

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Re: Omega Diagnostics (ODX)

#301246

Postby WickedLester » April 17th, 2020, 9:17 am

This has become a hot stock with the spike chasers and there has been absolutely huge turnover in the stock this week. I took the opportunity to sell most of my holding at around 30p and now only have a small amount kept for the long term.

30p was always my price target and it arrived sooner than I expected.

The upside for me is that as this was my largest investment and I all but tripled my money on them I am now only around 10% down and have a decent enough amount of cash to buy into any opportunities that present.

For starters I bought a few INLZ, ZYT and SNX but can't find much else I want to invest in so am sitting on the cash.

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Re: Omega Diagnostics (ODX)

#303334

Postby WickedLester » April 26th, 2020, 10:53 am

I may have been a bit hasty in selling most of these although I still hold some.

They're plastered across the front page of the Mail on Sunday today with talk of the University of Oxford having successfully developed a test and an order of 50m from the Government. I'll look for an announcement from the company on Monday.

I have to decide what price to sell the remainder of my holding at, anything COVID 19 related is being bid up to stupid levels and there could be a similar spike in the price here too. To be fair there probably already would have been if it wasn't for Oryx and Octopus dumping 15% of the equity.

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Re: Omega Diagnostics (ODX)

#304812

Postby Pipsmum » May 1st, 2020, 2:20 pm

These are 63p today and due news soon as far as I can tell by reading gossip.

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Re: Omega Diagnostics (ODX)

#324800

Postby Pipsmum » July 9th, 2020, 10:36 am

This little fella had taken a steep plunge recently and is currently scraping the 36-38p levels. There is news of it's approval to test in India now so maybe it will get back off the floor and fly back to the 60p levels again.

I got stopped out before so have just bought them back at this lower level to test that theory, so we'll see.

https://www.sharesmagazine.co.uk/news/m ... 9-in-India

Must be raising money to make it here...

https://www.sharesmagazine.co.uk/news/m ... as-planned

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Re: Omega Diagnostics (ODX)

#324857

Postby WickedLester » July 9th, 2020, 2:31 pm

I was a big believer in the potential of ODX when the price was 10p, but I fear now with the price at nearly 40p and then market cap around £70m that the Coronavirus bubble has burst and that they are too late to the testing table to really benefit from it.

I sold the last of my shares for a touch over 50p but will continue to monitor the company to see if I think it is worth reentering.

The company is also a bit accident prone and the recent announcement that they are scrapping their allergy business and writing off around £8m in development costs is another example of this.

Good luck with it though.

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Re: Omega Diagnostics (ODX)

#325163

Postby Pipsmum » July 10th, 2020, 1:34 pm

It temporarily went up but then I got stopped out. However I'd been moving the stop loss up, so was still £26.43 better off. Better than one in the eye with a sharp stick though.

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Re: Omega Diagnostics (ODX)

#346010

Postby WickedLester » October 7th, 2020, 8:52 pm

These are now over £1.

Selling too early has cost me £50k in lost profits. The curse of trying to invest on fundamentals I guess. I can't help but feel that the company is significantly overvalued now but a small Government contract just announced has the herd in a frenzy.

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Re: Omega Diagnostics (ODX)

#384377

Postby WickedLester » February 7th, 2021, 10:07 am

There's some press here today. It looks like the Government have selected Omega as one of 3 companies to supply rapid Lateral Flow Tests for workplace testing supplying up to 2 million tests per week. I expect the price will go a bit crazy tomorrow but I still think this represents a limited window of opportunity for Omega.

At £2 gross margin which I understand is the ballpark figure they will have to sell around 75m tests to be worth the current market cap to justify the current price but with the vulnerable population being rapidly vaccinated i wonder whether they'll get much more than a years worth of exceptional sales before it returns to more normal levels.

I'd like to think I was vindicated on this investment but really the nation's misfortune was my good fortune.

Anyone else have a view?

https://www.bloomberg.com/news/articles ... d-tests-ft

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Re: Omega Diagnostics (ODX)

#385616

Postby Pipsmum » February 11th, 2021, 11:08 am

These don't seem to hold value like some others. Just yoyo on good news. It'll be interesting to see if they can maintain an even keel with a larger order.

I hold some but sold the cheaper ones bought @55p on the recent spike. I can never hold my nerve long enough to be a 10 bagger type. My track record of selling says it'll go up now so lets see. I kept a few in case.

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Re: Omega Diagnostics (ODX)

#474826

Postby WickedLester » January 20th, 2022, 6:40 pm

It's been a real rollercoaster at this company but the price has fallen so far that I am considering buying back in again. The company abjectly failed to make any money from COVID testing. Whether this was their fault or the Governments is a moot point because it now looks like they never will make any real money from COVID testing. Apart from the major shareholders, Chris Mills and Richard Sneller the only people to make any real money out of COVID were the board who sold bucket loads of cheap option shares at prices close to a pound.

I also think there will be another fundraising sooner rather than later despite what the company says. I have been wondering whether the departure of Colin King and Bill Rhodes wasn't the price the institutions demanded to support a fundraise. I will hold off buying until that has happened.

But I do think at these sorts of prices and a market cap of just £25m this now could present an interesting opportunity.

I think the Health and Nutrition business is currently worth the market cap and they are targeting substantial growth in the USA and China. Progress on this growth has, however, been slower than hoped for.

Then there is CD4, a LFT for detection of advanced HIV targeted at low income countries, particularly in Africa. If they meet their sales targets this business could be making a gross profit of £11m in 3-5 years time.

My opinion is that this could 3-5 bag in 5 years and if it doesn't it is probably worth the current price just based on the profits of Health and Nutrition.

I'm not currently a holder. Anyone have a view?

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Re: Omega Diagnostics (ODX)

#480784

Postby WickedLester » February 15th, 2022, 6:12 pm

For anyone that's interested i've reevaluated this and decided to leave it alone.

They have announced a discounted placing and open offer as I suspected and there will be substantial dilution. It also appears to me that they are planning on selling CD4 so that is all of the upside gone before it has a chance to reach its potential.

I did handsomely well out of ODX in 2020 but I accept it was good luck more than anything, It seems apparent to me now that the company has been seriously mismanaged for a very long time.

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Re: Omega Diagnostics (ODX)

#485811

Postby WickedLester » March 11th, 2022, 11:47 am

Just to confirm it for those of you that think i'm daft I bought 50k shares this morning.

I know the company is cash strapped after shareholders voted down the fundraising but it's not entirely a wild punt.

IMO the most likely outcome for the company now is a sale of CD4 followed by the rump. I don't have a handle on what CD4 is worth, I understand it cost £2m to develop so i'll use that as a base value and say 1p and anything up to 10p a share for this. It may be an attractive investment for the Clinton Health Foundation or MSF.

That leaves the Health and Nutrition business which I think is easily worth 10p a share and maybe as much as 20p a share.

I have no interest in what if anything the COVID testing is worth, probably nothing.

So I believe the intrinsic value of the shares is anything from 11p up to as much as 30p in a best case scenario.

At these prices i'd be surprised to lose money but there are no certainties in this game.

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Re: Omega Diagnostics (ODX)

#486751

Postby jackdaww » March 15th, 2022, 4:32 pm

WickedLester wrote:Just to confirm it for those of you that think i'm daft I bought 50k shares this morning.

I know the company is cash strapped after shareholders voted down the fundraising but it's not entirely a wild punt.

IMO the most likely outcome for the company now is a sale of CD4 followed by the rump. I don't have a handle on what CD4 is worth, I understand it cost £2m to develop so i'll use that as a base value and say 1p and anything up to 10p a share for this. It may be an attractive investment for the Clinton Health Foundation or MSF.

That leaves the Health and Nutrition business which I think is easily worth 10p a share and maybe as much as 20p a share.

I have no interest in what if anything the COVID testing is worth, probably nothing.

So I believe the intrinsic value of the shares is anything from 11p up to as much as 30p in a best case scenario.

At these prices i'd be surprised to lose money but there are no certainties in this game.


===========================

SP jumped 16% today ...

:)

WickedLester
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Re: Omega Diagnostics (ODX)

#498934

Postby WickedLester » May 6th, 2022, 5:53 pm

I sold out today on the news that they are going to have a fundraising at 4p. Basically they're diluting all of the potential upside out. I made enough for a night out but not much more.

I think this is best left well alone now.

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Re: Omega Diagnostics (ODX)

#506282

Postby WickedLester » June 10th, 2022, 2:12 pm

Just to prove that I can't make my mind up I bought 50k shares today. I looked at the fully diluted market cap which I think is around £12m (fortunately and predictably the open offer flopped) and decided that with a bit of luck they are worth twice that and certainly not less.

I would like to see the BOD shaken up though, get rid of Jag Grewal and get someone that will focus on shareholder value and not endless fundraisings to finance projects which are then written off.


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