ASX:PNV

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Executive Summary

Polynovo Limited develops medical devices in the United States, Australia, New Zealand, and internationally. More Details

Rewards

Trading at 47.7% below our estimate of its fair value

Earnings are forecast to grow 48.2% per year

Risk Analysis

No risks detected for PNV from our risk checks.


Snowflake Analysis

Exceptional growth potential with adequate balance sheet.

Share Price & News

How has PolyNovo's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: PNV has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0%

PNV

2.5%

AU Medical Equipment

-0.4%

AU Market


1 Year Return

6.5%

PNV

10.7%

AU Medical Equipment

-7.0%

AU Market

Return vs Industry: PNV underperformed the Australian Medical Equipment industry which returned 10.7% over the past year.

Return vs Market: PNV exceeded the Australian Market which returned -7% over the past year.


Shareholder returns

PNVIndustryMarket
7 Day0%2.5%-0.4%
30 Day12.8%7.6%4.3%
90 Day11.3%10.6%4.3%
1 Year6.5%6.5%12.0%10.7%-3.8%-7.0%
3 Year648.5%648.5%37.0%30.8%17.0%2.3%
5 Year1,729.6%1,729.6%120.0%104.0%42.9%14.3%

Price Volatility Vs. Market

How volatile is PolyNovo's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is PolyNovo undervalued compared to its fair value and its price relative to the market?

47.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PNV (A$2.47) is trading below our estimate of fair value (A$4.73)

Significantly Below Fair Value: PNV is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: PNV is unprofitable, so we can't compare its PE Ratio to the AU Medical Equipment industry average.

PE vs Market: PNV is unprofitable, so we can't compare its PE Ratio to the Australian market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate PNV's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: PNV is overvalued based on its PB Ratio (68.6x) compared to the AU Medical Equipment industry average (6x).


Next Steps

Future Growth

How is PolyNovo forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

48.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PNV is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (2.3%).

Earnings vs Market: PNV is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: PNV's is expected to become profitable in the next 3 years.

Revenue vs Market: PNV's revenue (34.4% per year) is forecast to grow faster than the Australian market (4.7% per year).

High Growth Revenue: PNV's revenue (34.4% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PNV's Return on Equity is forecast to be very high in 3 years time (54.9%).


Next Steps

Past Performance

How has PolyNovo performed over the past 5 years?

-11.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PNV is currently unprofitable.

Growing Profit Margin: PNV is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: PNV is unprofitable, and losses have increased over the past 5 years at a rate of 11.8% per year.

Accelerating Growth: Unable to compare PNV's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: PNV is unprofitable, making it difficult to compare its past year earnings growth to the Medical Equipment industry (37.2%).


Return on Equity

High ROE: PNV has a negative Return on Equity (-17.61%), as it is currently unprofitable.


Next Steps

Financial Health

How is PolyNovo's financial position?


Financial Position Analysis

Short Term Liabilities: PNV's short term assets (A$19.3M) exceed its short term liabilities (A$9.5M).

Long Term Liabilities: PNV's short term assets (A$19.3M) exceed its long term liabilities (A$4.6M).


Debt to Equity History and Analysis

Debt Level: PNV's debt to equity ratio (30.6%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if PNV's debt to equity ratio has reduced over the past 5 years.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: PNV has sufficient cash runway for more than a year based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if PNV has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.


Next Steps

Dividend

What is PolyNovo current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate PNV's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate PNV's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if PNV's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if PNV's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of PNV's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.8yrs

Average management tenure


CEO

Paul Brennan

5.67yrs

Tenure

AU$2,133,987

Compensation

Mr. Paul Brennan, MBA, BSc (Nursing), RN, RM, serves as Managing Director at PolyNovo Limited since April, 2020 and serves as its Director since April 23, 2020 and serves as its Chief Executive Officer. He ...


CEO Compensation Analysis

Compensation vs Market: Paul's total compensation ($USD1.52M) is above average for companies of similar size in the Australian market ($USD924.67K).

Compensation vs Earnings: Paul's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
Paul Brennan
CEO, MD & Director5.67yrsAU$2.13m1.44%
A$ 23.5m
Jan-Marcel Gielen
CFO & Company Secretary1.83yrsAU$492.17kno data
Gordon Fleming
Director of Operationsno datano datano data
Katherine Napier
Marketing & Distributor Managerno datano datano data
Monica Benyk
HR Managerno datano datano data
Tim Moore
Principal Scientistno dataAU$145.12kno data
Edward Graubart
Senior Vice President of North America1.08yrsno datano data

1.8yrs

Average Tenure

Experienced Management: PNV's management team is not considered experienced ( 1.8 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Paul Brennan
CEO, MD & Director5.67yrsAU$2.13m1.44%
A$ 23.5m
Robyn Elliott
Independent Non-Executive Director1yrAU$46.70kno data
Bruce Rathie
Non-Executive Independent Director10.67yrsAU$64.64k0.55%
A$ 8.9m
Philip Powell
Non-Executive Director6.42yrsAU$64.64k0.19%
A$ 3.1m
David Williams
Independent Non-Executive Chairman6.58yrsAU$92.13k2.8%
A$ 45.7m
R. Johnston
Non-Executive Independent Director6.42yrsAU$64.64k0.23%
A$ 3.8m
David McQuillan
Independent Non-Executive Director8.17yrsAU$83.95k0.092%
A$ 1.5m
Leon Hoare
Independent Non-Executive Director4.75yrsAU$64.64k0.19%
A$ 3.2m
Christine Emmanuel
Independent Non-Executive Director0.42yrAU$9.33kno data

6.4yrs

Average Tenure

61yo

Average Age

Experienced Board: PNV's board of directors are considered experienced (6.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: PNV insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

PolyNovo Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: PolyNovo Limited
  • Ticker: PNV
  • Exchange: ASX
  • Founded: 1998
  • Industry: Health Care Supplies
  • Sector: Healthcare
  • Market Cap: AU$1.633b
  • Shares outstanding: 661.09m
  • Website: https://www.polynovo.com.au

Number of Employees


Location

  • PolyNovo Limited
  • 320 Lorimer Street
  • Unit 2
  • Port Melbourne
  • Victoria
  • 3207
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CALZ.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDNov 1998
PNVASX (Australian Securities Exchange)YesOrdinary SharesAUAUDNov 1998
PNVCHIA (Chi-X Australia)YesOrdinary SharesAUAUDNov 1998
MFJDB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 1998

Biography

Polynovo Limited develops medical devices in the United States, Australia, New Zealand, and internationally. The company offers NovoSorb Biodegradable Temporising Matrix, which is used in a fully debrided ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/24 10:30
End of Day Share Price2020/10/23 00:00
Earnings2020/06/30
Annual Earnings2020/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.