ScoPo’s Powerplays: Hearing tech, medical devices to ride out choppy market
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Healthcare and life sciences expert Scott Power, who has been a senior analyst with Morgans Financial for 24 years, explains what the movers and shakers have been doing in health and gives his ASX powerplays.
Healthcare finished the week up 1.58 per cent, compared to the broader market which rose by 0.23 per cent.
Inflation anxiety in Australia and overseas continued to play out on growth stocks this week, causing volatility in the share prices of biotech stocks.
Hearing tech company Audeara (ASX:AUA) made its ASX debut on Tuesday, but the stock price has tanked and fallen to 14.5c, below its IPO price of 20c.
Morgans was the IPO manager for Audeara, and Power remains bullish on the stock and the hearing technology segment in general.
“The thesis on this stock still remains intact, as there is definitely an increasing trend towards hearing health,” he said.
Audeara makes headphones designed to complement hearing aids, helping people with entertainment experiences, such as watching TV.
“We believe there is a big upside for Audeara in terms of growing overseas in markets like the US,” he argued.
The other stock that Power is tracking closely is breast imaging specialist, Volpara Health (ASX:VHT), which will release its full year results and guidance on Thursday, 27 May.
The NZ-based company has had a solid last quarter, reporting a 20 per cent growth in its ARR (annual recurring revenue) to US$18.6 million.
Power also pointed to the company’s average revenue per user (ARPU) figure, which has increased from US$1.22 in Q3, to US$1.40 at the end of Q4.
But he says the bigger picture for Volpara is that they have a huge slice of the market, having screened around 32 per cent of women in the US.
The immuno-oncology market is also a new, hot emerging trend that Power has his pulse on.
Earlier this week, Imugene announced a licensing agreement with world-renowned cancer research centre in Los Angeles, the City of Hope. The worldwide licence will cover a novel method of immunotherapy, which combines oncolytic virus and cell therapy technology.
Rythym Biosciences (ASX:RHY)
The medtech company announced that its priority for FY22 is to fast-track the commercialisation of its cancer detection technology, ColoSTAT. The ColoSTAT is a blood test that can detect colorectal cancer at all stages, including the early ones. The company has commenced initial preparation for FDA approval in the US, CE mark in Europe, and TGA certification in Australia.
LBT Innovations (ASX:LBT)
LBT announced the sale of two of its APAS Independence instruments to the Health Services Laboratory (HSL) in the United Kingdom. The APAS instrument is an FDA-approved automated process that can process over 200 culture plates per hour, which is at least three times faster than manual culture plate reading.
BARD1 Life Science (ASX:BD1)
The company announced the launching of its first Molecular NET product, EXO-NET, its proprietary technology that allows fast capture of exosomes in under 15 minutes. The exosomes can be taken from from any biological sample including blood, urine and saliva.
The company announced that its PainChek Infant app has received the necessary regulatory clearances including the CE Mark and UK MHRA, which will allow for sales in Australia, Europe, UK, Canada, Singapore and New Zealand. The PainChek Infant app does a microfacial analysis through a three-second video assessment, and provides the caregiver with an instant result in relation to the infant’s pain severity level.
The Powerplay stock of the week is Pro Medicus (ASX: PME).
The company, along with fellow ASX-lister Mach 7 (ASX:M7T), won contracts with the UVM Medical Centre in Vermont last week, to upgrade the centre’s old legacy systems.
The deal was a $14 million, eight-year contract to implement the cloud-based Visage 7 Enterprise Imaging platform across UVM’s six hospitals, with go-live targeted for the second half of 2021.
Power believes that this trend will continue, and more deals like this will happen in the future as more hospitals replace their existing legacy systems with newer technology.
“There is also an increasing trend of contracts to be awarded with data going up into the cloud – a double trend, if you like,” Power said.
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