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Projecting the future valuation of companies and their innovative technology is at best an "inexact science" and needs to be
understood in terms of its intent and vulnerabilities. Scimitar accepts its responsibility to research and prudently perform
analysis while incorporating due diligence. The value of science or technology platform, product development cycles, regulatory
timelines and filings, collaboration partners, management team and ultimately market initiatives should not be quantitatively
modeled too early. Projecting "true" value in a developing business with a new and evolving market with little known internal
and external variables is very difficult. Manipulation of quantitative data to analysis in some companies has a limited value
in this health science sector. But a qualitative interpretation could determine definitions of the capacities, capabilities,
and the potential of shareholder value. We recognize the inherent complexities and dearth of predictability linked to this
process and we also realize the utility of the intangibles. Investors need to have time sensitive qualitative information
and be able to be appraised by the interpretation of this information. We provide our best qualitative thinking. Scimitar
integrates information, facts, estimates, and realities and then merges concepts with risks, unknowns and honest interpretation.
The valuation narrative is compiled as an information thesis. Some companies with minimal and in most cases no revenues should
not employ traditional valuation metrics, such as current P/E ratios, revenue multiples and EDBITA multiples, when attempting a
"real" future valuation of shares. We believe investors should focus on the real issues: the time necessary to complete the
required development steps, management's experience, clinical end-points, trial initiations and regulatory filings, financial
resources to fund on-going development, the revenue potential and recently the capacity for acquiring product enhancing line
extensions of complimentary technology. Most stocks are sensitive to competitive regulatory filings and news flows and markets
do not always incorporate the value of products into the stock price. Investors should understand the regulatory milestones
that could produce valuation enhancement for companies.
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