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What Investors Should Know About Premaitha Health PLC’s (LON:NIPT) Financial Strength

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Michael Crabtree
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While small-cap stocks, such as Premaitha Health PLC (AIM:NIPT) with its market cap of UK£12.85M, are popular for their explosive growth, investors should also be aware of their balance sheet to judge whether the company can survive a downturn. Medical Equipment companies, in particular ones that run negative earnings, are more likely to be higher risk. Assessing first and foremost the financial health is vital. I believe these basic checks tell most of the story you need to know. Nevertheless, this commentary is still very high-level, so I’d encourage you to dig deeper yourself into NIPT here.

Does NIPT generate an acceptable amount of cash through operations?

NIPT’s debt levels surged from UK£1.36M to UK£4.43M over the last 12 months , which comprises of short- and long-term debt. With this increase in debt, NIPT currently has UK£1.30M remaining in cash and short-term investments , ready to deploy into the business. Moving onto cash from operations, its trivial cash flows from operations make the cash-to-debt ratio less useful to us, though these low levels of cash means that operational efficiency is worth a look. For this article’s sake, I won’t be looking at this today, but you can examine some of NIPT’s operating efficiency ratios such as ROA here.

Does NIPT’s liquid assets cover its short-term commitments?

At the current liabilities level of UK£6.94M liabilities, it appears that the company has not been able to meet these commitments with a current assets level of UK£6.12M, leading to a 0.88x current account ratio. which is under the appropriate industry ratio of 3x.

AIM:NIPT Historical Debt Mar 29th 18
AIM:NIPT Historical Debt Mar 29th 18

Does NIPT face the risk of succumbing to its debt-load?

Since total debt levels have outpaced equities, NIPT is a highly leveraged company. This is not unusual for small-caps as debt tends to be a cheaper and faster source of funding for some businesses. But since NIPT is currently unprofitable, there’s a question of sustainability of its current operations. Running high debt, while not yet making money, can be risky in unexpected downturns as liquidity may dry up, making it hard to operate.

Next Steps:

With a high level of debt on its balance sheet, NIPT could still be in a financially strong position if its cash flow also stacked up. However, this isn’t the case, and there’s room for NIPT to increase its operational efficiency. In addition to this, its lack of liquidity raises questions over current asset management practices for the small-cap. I admit this is a fairly basic analysis for NIPT’s financial health. Other important fundamentals need to be considered alongside. I recommend you continue to research Premaitha Health to get a better picture of the stock by looking at:


To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.

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    (Bloomberg) -- The direct listing of Coinbase Global Inc. on Nasdaq is a turning point for the whole cryptocurrency sector, according to the firm’s Chief Executive Officer Brian Armstrong.Banks used to hang up on Coinbase’s calls and many people thought the digital-currency platform was a bad idea, Armstrong said during a discussion on the Clubhouse app after the stock’s debut. Now top executives from the banks that helped Coinbase go public are calling to ask how they can get more into crypto themselves, he said.“It feels like a shift in legitimacy not just for Coinbase but the whole industry,” Armstrong said. “Crypto has a shot at being a major force in the financial world.”Coinbase, which fell 14% on its debut Wednesday to close at $328.28, now has a valuation of about $86 billion on a fully diluted basis. That compares with a 2018 funding round that valued it at around $8 billion. The listing was widely anticipated by the wider crypto community, with many coin prices and crypto-affiliated company shares rising in advance of it, before falling back once the trading started.The company’s growth hasn’t been without controversies, such as restrictions Armstrong placed on employee discussions of politics last year, or frequent outages during periods of heavy trading. Some people criticize the level of fees charged by the exchange.There was also a settlement with the Commodity Futures Trading Commission for $6.5 million regarding claims Coinbase had reported inaccurate data about transactions and that a former employee engaged in improper trades.More generally, skeptics maintain that crypto could be in a bubble, and may suffer due to regulatory changes around the globe. Coinbase and its backers see more strength ahead.“There was tremendous depth and richness to what these guys were doing,” said Marc Andreessen, co-founder of investment firm Andreessen Horowitz, one of Coinbase’s biggest shareholders, in a portion of the same Clubhouse discussion talking about what made the company an appealing investment.Andreessen said Coinbase provided a combination of “a company that’s conservative enough to be compliant from a regulatory perspective but also relentlessly innovative.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

  • Alcoa Quarterly Results Top Estimates as Aluminum Prices Surge

    (Bloomberg) -- Alcoa Corp. reported first-quarter earnings that beat analysts’ expectations, with aluminum prices surging amid optimism that reopening economies will spur demand for everything from automobiles to airplanes to toasters.The biggest U.S. aluminum producer reported earnings before interest, taxes, depreciation, and amortization of $521 million, topping the $450.8 million average of six analysts’ estimates compiled by Bloomberg and the highest since 2018. Sales rose to $2.87 billion, the company said in a statement Thursday, compared with the $2.62 billion analysts had forecast.Shares of Alcoa have climbed six-fold from a pandemic low last year, with aluminum demand rising just as China’s push to cut carbon emissions spurs expectations that the Asian nation will curb aluminum-supply expansions. China is the world’s largest producer of the metal. Alcoa Chief Executive Officer Roy Harvey said last month that China is taking meaningful steps to rein in production, calling it a “game-changer” for the industry after years of gluts.The Pittsburgh-based company expects a strong 2021 based on continued economic recovery and increased demand for aluminum in all end markets, according to the statement.Benchmark aluminum prices surged 25% from the end of September through March, marking the biggest gain over that period since 2006.A resurgence in virus cases and vaccine shortages in some countries is hurting economic-growth prospects in regions including Asia. Federal Reserve Chair Jerome Powell said this week that while the U.S. economy appears poised for stronger growth, Covid-19 remains a threat.The earnings statement was released after the close of regular trading in New York, where Alcoa fell 1.7% to 32.84. The shares rose following the report.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

  • BlackRock’s Record-Breaking ESG Fund Looks Just Like a Big Tech ETF

    (Bloomberg) -- As the biggest launch in the history of ETFs, it’s a ringing endorsement of all things ESG. But beyond its billion-dollar debut, BlackRock Inc.’s new fund might feel awfully familiar to most investors.The top holdings in the U.S. Carbon Transition Readiness ETF (ticker LCTU) -- which lured about $1.25 billion in its first day on Thursday -- turn out to be Apple Inc., Microsoft Corp., Amazon.com Inc., Alphabet Inc. and Facebook Inc.The same five companies, in the same order, are the top stakes in the largest environmental, social and governance ETF on the market, the $16.5 billion iShares ESG Aware MSCI USA ETF (ESGU). That’s also from BlackRock with a fee of 0.15%, half the price of LCTU.In fact, those tech megacaps form the bedrock of many exchange-traded funds, both in the ESG space and beyond. For example, four of them also are among the five largest holdings of the $167 billion Invesco QQQ Trust Series 1 ETF (QQQ), which is simply tracking the Nasdaq 100. “The new fund looks akin to any other U.S. tech fund,” said James Pillow, managing director at Moors & Cabot Inc. Its early success is all tied to the growing “drumbeat” to allocate to investments tied to responsible themes, he said.For all their overlap in terms of holdings, there are key differences between funds like LCTU and ESGU.The new arrival is actively managed, and aims to target Russell 1000 companies that are best positioned for a green energy transition, considering issues like clean technology and waste and water management.Meanwhile, its more-established sister product passively tracks an index with a broader ESG remit.The sheer size of some tech names naturally leads to heavy ownership, especially by cap-weighted ESGU. The common holdings also may say more about the tech giants and their commitment to ESG, including clean power, than they do about the funds’ strategies.LCTU’s similarities to more mainstream indexes are intentional, according to Carolyn Weinberg, global head of product for iShares at BlackRock. “It enables our clients to invest as a core part of their portfolio as opposed to a satellite aspect,” she said. “They can build portfolios the way that they traditionally build portfolios, but substitute out the benchmark and add the sustainable or climate version.”The approach has certainly won some early fans. A consortium of large institutions was behind the stellar debut of LCTU and another fund, the BlackRock World ex U.S. Carbon Transition Readiness ETF (LCTD), the firm said in a statement. These included the California State Teachers’ Retirement System.Read more: Record Number of ETFs Launch Into Industry Deluged With CashThe record launch comes while many questions linger in the still-maturing ESG sector. A report released Friday by the U.S. Securities and Exchange Commission cautioned that some firms are mis-characterizing their products as ESG, possibly even violating securities laws in the process. The agency didn’t name any companies.“The definition of ESG is wide enough to drive a fleet of semi trucks through,” said Ben Johnson, Morningstar Inc.’s global director of ETF research. Even so, ESG ETFs are in demand. They attracted a record $31 billion in 2020, almost four times the prior year. In January alone, investors added $6.3 billion for a best-ever month. That’s pushed assets to an all-time high of $75 billion, up from less than $10 billion two years ago.“It’s one of the areas where I think you will see growth, but there’s very little consensus as far as how you measure these things,” said Marc Odo, client portfolio manager at Swan Global Investments. “We need to be little bit more diligent about how we use that label.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.

  • When will ‘plus-up’ stimulus check payments arrive? Catch-up COVID payments sent to 700,000 Americans in latest batch

    The IRS sent out COVID-19 relief checks to nearly 2M more Americans, including over 700,000 'plus-up' payments for people eligible for more money.

  • The monthly stimulus checks for families will start in July, IRS now says

    The IRS commissioner says the child credit payments will arrive on time after all.

  • Powell Says U.S. Entering Faster Growth, Though Virus Spike Remains a Risk

    (Bloomberg) -- The Federal Reserve will likely scale back its bond purchases before considering raising interest rates, Chairman Jerome Powell said, hardening expectations on the sequence of its eventual exit from aggressive policy support.“We will reach the time at which we will taper asset purchases when we’ve made substantial further progress toward our goals from last December, when we announced that guidance,” Powell said Wednesday in a virtual event hosted by the Economic Club of Washington. “That would in all likelihood be before -- well before -- the time we consider raising interest rates. We haven’t voted on that order but that is the sense of the guidance.”The appearance was the latest of several by the Fed chair this month, including an interview on CBS’s “60 Minutes” show on Sunday in which he said the economy appears to have turned a corner toward faster growth amid widening vaccinations against Covid-19, but central bankers would not be in a hurry to remove their support.Policy makers will wait until inflation has reached 2% sustainably and the labor-market recovery is complete before considering lifting interest rates, and the combination is unlikely to happen before 2022, he said. Their forecasts last month signaled rates being held near zero through 2023.The U.S. central bank enters its traditional blackout period on public comment on Friday night ahead of the April 27-28 meeting of the Federal Open Market Committee.“When the purchases go to zero, the size of the balance sheet is constant, and when bonds mature you reinvest them,” Powell said. “And then another step -- and we took this late in the day in the last cycle -- was to allow bonds to start to runoff. And we haven’t decided whether to do that or not.”Powell added that he doesn’t think the Fed would actually sell bonds into the market, something it also didn’t do during the recovery from the 2008 financial crisis.Fed Vice Chair Richard Clarida made a similar point about the sequencing of the exit strategy in remarks later Wednesday.“We’re going to reduce the pace of purchases at some point and that would occur prior to any decision about lifting off,” he said in response to question during a virtual event hosted by the Shadow Open Market Committee. Noting that he has a “very robust” baseline outlook for U.S. growth in 2021 that could be the fastest in 35 years, Clarida added that policy makers were not going to act on a forecast.“This is going to be outcome based. We’re going to be looking at the labor market indicators and the inflation data as it comes in,” he said.Patience PledgedPowell and his colleagues have pledged to be patient and maintain aggressive monetary policy support, even as the economic recovery from the pandemic picks up speed. That dovish view has helped U.S. stocks reach fresh record highs. Recent data has also painted a brighter picture as vaccinations spread and the economy reopens, with employers adding 916,000 jobs in March.“Most members of the committee did not see raising interest rates until 2024, but that isn’t a committee forecast, it isn’t something we vote on or or act on as a group -- it really is just our assessment,” Powell said. “Markets focus too much on what we call the economic predictions, and I would focus more on on the outcomes that we’ve described.”Fed policy makers substantially lifted their growth and employment forecasts at the central bank’s meeting last month. Their median estimate sees the economy expanding 6.5% this year and the unemployment rate declining to 4.5% by the end of 2021.Powell said the U.S. is going into a period of faster growth and job creation, and that the main risk is another spike in Covid-19 cases due to virus strains that may be more difficult to treat.Minutes of the central bank’s March meeting released April 7 said policy makers expect it will likely be “some time until substantial further progress” was made on employment and inflation. That refers to the threshold they’ve set for scaling back bond purchases of $120 billion a month.(Updates with comments from Clarida in ninth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.