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CombiMatrix Corporation Message Board

  • kapsnerp kapsnerp Jan 14, 2013 4:35 PM Flag

    Estimated revenue

    I looked over their stats from Q4, 2011 where they did about 300 prenatal tests. Growth of 171% YOY indicated they did about 820 tests in Q4, 2012. They appear to collect $820 per test (based on Q3 where they did 550 tests and generated $450,000 in revenue).

    So if I take 820 tests x $820 per test, we get about $650,000 in revenue for the quarter in prenatal tests.

    Their current cash burn is about $1,400,000, so with the $650,000 in revenue, plus an estimated $500,000 in additional revenue, they are nearly a break-even company.

    To be break-even as just a prenatal company, they need to be running about 1700 tests a quarter or 7,000 tests annually (rounded). That would yield $5,630,000 in revenue.

    The estimated market for microarray prenatal testing is $600,000,000. So they need less than 1% of the total market to be break-even. If they manage to even get 5% of the total market, it is a solid business with about $20,000,000 in cash flow (assuming they can scale to this level without a ton of additional expenses.) Even if they have to invest another $5,000,000 to get to this scale, they'd have to be a $10 stock.

    However, they need to have additional opportunities in the future to grow outside of this market (not sure what those might be), and this all doesn't matter with the market that loves to drive stocks like this out. Just my two cents.

    It doesn't appear a scam company. It does appear the market wants to see if they can execute. Q4 looks like a pretty good start.

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