Opinions
Fabrice Taylor
Covalon Technologies
COV-X
COMMENT
Nov 16, 2017
$4.420
Stock price when the opinion was issued
medical services
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BUY
They make medical supplies, signed a large contract recently and are doing well. They compete successfully with companies like 3M overseas. The stock is not very liquid because there is one very large owner. It has risen recently, but if you own it, you should hang onto it. They surprise people with good news, which shows up in the stock price.
medical services
TOP PICK
COMMENT
Essentially health care dressing, bandages and things like that. They have a big entrance into the market when they won a big contract in Saudi Arabia but now there are concerns with all the problems with that country. They have a foot on the US side now as well. Revenue is very good. It is high risk as it is a small name.
medical services
RISKY
He likes their potential, especially with a $100 million project in the Middle East (although Canada's relation with Saudi Arabia is strained). They make wound bandages and compete against companies like Johnson&Johnson. This should be a good year. They are debt free and are expanding their business in the US. He would endorse the management team. It is a speculative buy until they can bring forward more contracts to monetize their cash flow.
medical services
WATCH
WEAK BUY
Bandages and dressings / wound care. They made a few miss-steps recently. An overseas issue has been addressed. They signed some agreements overseas and the revenue is not yet coming in. Even if the contracts don't generate cash flows, it is already in the stock, but if money comes in there could be upside from it. They are working in other areas as well. He likes the trade-off
medical services
PAST TOP PICK
(A Top Pick Aug 08/18, Down 78%) They had a $100 million contract from the Middle East, but the revenue in the deal has been delayed. COV had huge promise and now it's Show Me The Money. The revenue delay is hurting them. Also, they had a recent stock issuance. But insiders still own a big chunk of this.
medical services
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It is not a well known name at all. It is medical products. One investor owns close to a half of it. They are gaining market share. He is guessing they are a takeout play at some point.