Friday, October 26, 2007

PXS.AX - 10 Bagger

PXS.AX is cheap. It's a punt, but it's cheap and the numbers make a lot of sense. It's currently trading around $4, and we think it could be $15 by 2010 as it transitions to a mature Pharma company with a suite of products being sold in a range of markets.

here’s why:
- A suite of products with multiple uses in markets where there is a huge need but there are no (or very
few) substitutes
- Importantly these products are either already being marketed and sold or in late stage clinical trials,
significantly de-risking the company
- A strong financial position with ~$125 million in cash
- Scale – PXS has a market cap now close to $800 million which means it will begin to get the attention
of funds and big investors, allowing the company to source the necessary financing needed to bring
its products to market… and has a NASDAQ listing
- A very strong, dedicated and proven management team
- A vision to develop an independent and fully integrated pharmaceutical company meaning
shareholders will reap the long term benefits of PXS success, not an international company
- Potential for a big re-rating as the company moves from a research and development company to a
fully integrated and profitable pharmaceutical company
- Tight share register with a number of substantial institutional shareholders on board

Don't bet the farm, but have some exposure to this stock, it's not often you find an Australian Company that has this much blue Sky Potential, particularly one that isn't leveraged to the commodity bull.


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