ASX:PNV
Polynovo Ltd
Investment Summary
The fund managers believe Polynovo Ltd (PNV) presents a compelling investment opportunity, highlighting strong financial performance with **a 66% year-on-year sales growth** and **positive NPAT** achieved in the recent half-year results. In their opinion, **Polynovo's competitive position in the wound care market is strengthened by its dominant market share and significant growth in global sales**, particularly **122% outside the US**. They indicate confidence in upcoming catalysts, especially the potential of the **NovoSorb product becoming the standard of care for burns**. Despite a recent decline in share price, the managers assert that this is likely a consolidation phase post-rally and not reflective of the underlying strength, with expectations for **continued strong sales growth and profitability in FY25**. They regard the **Barda trial results as key for further adoption in the US market**, especially as a competitor like Integra faces challenges. Overall, the fund managers maintain a positive outlook, characterized by **ongoing revenue growth** and **successful entry into new global regions**.
Commentary From The Managers
Blackwattle Investment Partners
31 Aug 2024
$2.35
- Polynovo fell 13% in August after delivering an inline result.
- The reason for the share price drop is unclear, as FY25 is shaping up as a good year for the company.
- PNV’s Barda trial has completed recruitment and data release is expected shortly.
- Anticipated results are expected to drive further adoption in the core US market.
- Competitor Integra continues to face challenges due to product recalls.
- Integra’s products are only now being depleted from inventories, positioning PNV to benefit significantly.
- Blackwattle Investment Partners continues to hold because of these positive developments.
Endeavor Asset Management
31 Aug 2024
$2.35
- Endeavor Asset Management continues to monitor Polynovo (PNV) after a 31% rise over three months to July.
- In August, the shares experienced a decline of 13%.
- Management confirmed the FY24 revenue performance with a positive outlook for growth.
- Early success with product price increases has been noted.
- There is ongoing progress across the broad product pipeline.
- With competitor Integra temporarily out of the market, FY25 is expected to be another strong year.
Endeavor Asset Management
31 Aug 2024
$2.35
- Endeavor Asset Management notes a 31% rise in Polynovo shares over the three months to July.
- In August, shares declined 13%, but the company confirmed strong FY24 revenue performance.
- The outlook indicates continued business growth.
- Management reported early success with product price increases.
- Positive progress is evident across the company’s broad product pipeline.
- With competitor Integra temporarily out of the market, FY25 is expected to be another strong year for Polynovo.
- Endeavor Asset Management continues to hold due to these positive indicators.
Endeavor Asset Management
31 July 2024
$2.68
- Endeavor Asset Management notes that Polynovo Ltd (PNV) achieved a 9.4% increase in July following a preliminary earnings release for FY24.
- Reported revenue of $104.8 million was 2% ahead of consensus and represented a 58% year-over-year growth.
- US and rest-of-world sales saw increases of 49% and 73%, respectively, indicating successful expansion into new global markets.
- The firm's Novosorb burns product is considered best in class, positioning the company well for future growth.
- Endeavor Asset Management anticipates that FY25 will see continued sales growth and profitability.
Endeavor Asset Management
31 July 2024
$2.68
- Endeavor Asset Management notes that Wound care company Polynovo (PNV) lifted 9.4% in July following a preliminary earnings release for FY24.
- Revenue of $104.8 million was 2% ahead of consensus and increased by 58% year-over-year.
- US sales grew by 49% while sales in the rest of the world increased by 73%, highlighting successful global expansion.
- The company’s Novosorb burns product is considered best in class.
- Endeavor Asset Management expects FY25 to show continued sales growth and profitability.
Endeavor Asset Management
30 June 2024
$2.33
- Endeavor Asset Management notes a 9% increase in PolyNovo's share price in June.
- Observed a strong performance leading up to the end of the financial year.
- Highlighting that a 7% sell-off was deemed overdone by the fund manager.
- Noted an eventual recovery of over 10% in share price.
- Positive broker research continues to support the investment case.
- Endeavor Asset Management maintains its position in PolyNovo.
Endeavor Asset Management
31 May 2024
$2.25
- Endeavor Asset Management notes a 9.8% share price increase for PolyNovo (PNV) in May, driven by strong demand.
- The company reported a record group revenue of A$10.1 million in April.
- Projections indicate commercial revenues may reach A$53 million in the second half of 2024.
- Novosorb BTM is expected to become the standard of care for burns and trauma in the US market.
- Significant revenue growth outside the US has been observed, particularly in UK/Ireland, ANZ, HK, and Germany.
- Endeavor Asset Management participated in a visit to PolyNovo's Port Melbourne facility, reinforcing their investment thesis.
Endeavor Asset Management
31 Mar 2024
$2.14
- Endeavor Asset Management continues to hold an investment in Polynovo Ltd.
- Despite a positive earnings report in late February, the company experienced a 4% decline in share price in March.
- This decline is attributed to consolidation following a significant rally.
- The stock performance was a detractor to overall performance.
- Polynovo's fundamentals remain strong, supported by broad adoption of its core product.
- Ongoing regulatory progress continues to bolster its long-term growth potential.
Endeavor Asset Management
28 Feb 2024
$2.13
- Endeavor Asset Management continues to hold shares in Polynovo Ltd. (PNV) following a 20% increase in shares over the month.
- The first-half results showcased strong sales growth of 60% compared to the previous corresponding period (pcp).
- Polynovo has entered positive Net Profit After Tax (NPAT) territory.
- Sales growth has surpassed market expectations in both the US and the Rest of World (RoW), with RoW contributing 25% of first half sales.
- PNV’s dominant market position and global sales traction are notable.
- The company’s well-controlled costs support a view that shares should trade at a material premium to peers.
Endeavor Asset Management
31 Jan 2024
$1.91
- Polynovo was the second largest contributor after announcing sales ahead of expectations.
- Total sales grew 66% year on year, with 122% growth outside of the US.
- Achieved profitability during the half.
- Several near-term positive catalysts identified.
- Significant longer-term opportunities in additional indications.
- Endeavor Asset Management continues to hold due to these factors.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.