Frenkel Topping (FEN) : Corp

A smart move helping the company to achieve scale

Key data

  • Share price (p) 38.5
  • Target price (p) 45.0
  • Market cap (£m) 26.3
  • Enterprise value (£m) 24.3

Outsourcing elements of the DFM allows Ascencia to scale, while simultaneously retaining investment management fees for AUM managed in-house.

Nik Lysiuk

KRM22 (KRM) : Corp

Managing financial risk

Key data

  • Share price (p) 75.5
  • Target price (p) 100.0
  • Market cap (£m) 13.8
  • Enterprise value (£m) 11.6

KRM22 delivers a scalable platform to grow subject matter expertise companies in financial risk management. Through cross sales to a receptive audience looking for a coherent approach to risk, acquired businesses gain the opportunity to graduate to a global growth environment, leveraging off group infrastructure. The creation of the Global Risk Platform (GRP) – combining multiple software applications in one place, allowing single sign-on and integration of multiple operational risk tools – becomes a virtuous circle for customer risk mitigation and regulatory compliance. We expect run rate positive cash generation and profitability during FY20. Target price 100p. Full initiation note to follow.

Andrew Darley

Shield Therapeutics (STX) : Corp

Patent challenge

Key data

  • Share price (p) 114.0
  • Target price (p) 200.0
  • Market cap (£m) 133.5
  • Enterprise value (£m) 123.7

Shield Therapeutics has notified the market that it has received notice that TEVA is appealing the decision from the European Patent Office that endorsed one of its patents protecting Feraccru. The patent covers a Process for preparing an iron hydroxypyrone, which expires in 2033. No date has been set for the hearing. This patent forms part of an extensive range of patents protecting Shield’s core product, Feraccru. The core composition of matter patent expires in 2035. This comes as no surprise. We are making no change to forecasts or valuation and reiterate our target price of 200p.

Mark Brewer

Avacta (AVCT) : Corp

TMAC programme accelerates

Key data

  • Share price (p) 29.8
  • Target price (p) 125.0
  • Market cap (£m) 34.4
  • Enterprise value (£m) 22.6

Avacta announced that it expects to submit an IND/CTA application early in 2020 to test the TMAC linker with doxorubicin in a Phase I study in patients with selected solid tumours. The linker is a critical element of the novel Affimer TMAC platform that Avacta is co-developing with Tufts University Medical School, the first product (PD-L1/i-DASH inhibitor) from which is expected to enter the clinic in 2021. Not only is this testing of the TMAC linker well ahead of original plans, but it potentially creates additional sources of non-dilutive funding from licensing the linker to create effective chemotherapeutic pro-drugs that are currently limited by dose-limiting systemic toxicities. Proving the enzyme-sensitive linker works in humans also increases the prospect of licensing the Affimer TMAC platform before clinical data are generated from its first Affimer TMAC.

Mark Brewer

Europa Oil & Gas (EOG) : Corp

Irish exploration back in the spotlight

Key data

  • Share price (p) 2.9
  • Target price (p) 45.0
  • Market cap (£m) 12.9
  • Enterprise value (£m) 8.5

Europa has completed the sale of its 20% stake in UK onshore licence PEDL143 to UK Oil & Gas for £300k, payable in UKOG shares. This portfolio tidy-up removes a small exploration opportunity from the portfolio that was proving difficult to get to the drilling stage and was consuming management time that will be better spent on more material exploration opportunities within the portfolio. More important will be the outcome of the Iolar exploration well offshore Ireland that has recently spud and, if successful, will de-risk a material portion of Europa’s portfolio.


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