All Ords 5291 up 180 pts or 3.5%
Trading portfolio
A further 16.5% rise in SciDev shares (SDV, 49.5¢ up 7¢, $70m) added 8.9% to portfolio value. Here are the daily and hourly charts. The stock peaked at 56¢ in the first 15 minutes of trading then declined over the course of the day. At this point the rally uptrend remains in force. Resistance in the form of the main downtrend line is currently in the 60-65¢ range and this is also the target for the head and shoulders bottom formation.
The rise came after an announcement this morning that sales revenue in March was a record $4.8m; not bad going in the face of the coronavirus pandemic! It followed an announcement on 24 March that revenue for the YTD was greater than $12m (which implies QTD revenue of perhaps $6m because Dec H revenue was $6.1m). My revenue estimate for the full FY20 year is $29m (which would imply average monthly revenue of perhaps $5.5m in the final quarter) and I am now thinking that could be a touch high but one never knows what might come out of the woodwork. And perhaps I should remind you that my scenario-based DCF-based valuation is around $1.50.
Movements in other stocks added 0.6% to portfolio value. Main influences were SMI +20%, which sounds good but it was only the minimum increment of 0.05¢, then PNV +12%, BTH -9% and A4N +15%.
Long term portfolio
A 2.9% rise in Electro Optic Systems shares (EOS, $4.32 up 12¢, $488m) added 0.9% to portfolio value. Here is the hourly chart.
Movements in other stocks added 2.4% to portfolio value. Main influences were AKP +19.8%, NAN +14.5%, CAR +10.6% and CSL +3.5%.
I made a comment earlier this week that shares in Audio Pixels (AKP, $10.90 up $1.80, $308m) looked awful. And I note that today’s rise did not break the downtrend. But today’s announcement also provides some hope. As usual, the announcement was brief, with no commentary around its significance. So let me do that. To summarise, after all these years of angst, wafers which are expected to finally meet all requirements have been received from AKP’s fabrication partner, and a two week testing process of their “impulse response” has begun. Should this confirm the company’s expectations, and there is no reason why not, then wafers will be made available to potential customers for them to test, and negotiations will begin on commercial outcomes. This process could presumably take some months, and will likely take longer than previously expected due to the impact of the coronavirus, but the end is in sight. The possibilities could range from mass production and sale of millions and later billions of chips, to an agreed takeout of the company at a huge premium to the current price.
Phoslock (PET, 52.5¢ up 1¢, $297m)
Here are the daily and hourly charts. The shares traded within a tight trading range as they consolidated after the big rise yesterday, and the rally uptrend is still in force.
Other stocks
No comments today.
New breakouts of interest
None today.
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