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Ludlow BioVentures Upgrades Research Opinion on CryoPort, Inc. (CYRX),
Maintains Price Target
of $3.00 per share
Last Updated: Dec.
04, 2008
- 6:14pm EST
NEW YORK--Ludlow
Bio Ventures upgrades research rating on CryoPort, Inc. (OTC: CYRX),
a leading supplier of affordable temperature sensitive shipping solutions
for the frozen biopharmaceutical industry, maintains B+ rating, and near-term price target
to $3.00 per share.
Summary
While most investors have been focusing on the deteriorating markets
and global economy, CryoPort has been banging out some big name leads for
their CryoPort Express(TM) pilot
shipping program. In their recent 10Q report, the Company announced net
inventories increased $299,393 (246%), to $421,345 as of September 30,
2008, from $121,952 as of March 31, 2008. The increase in inventories is
due to the purchases of raw materials during the six months ended
September 30, 2008 for the build-up of dewars in finished goods inventory
in anticipation of the full launch of the CryoPort Express® One-Way
Shipper System. This indicates the Company has built their inventory to
begin potentially taking in contract orders from potential shippers.
The Company have now established potential large named clients for their
shipping program, have set in place the logistical shipping platform in
India, developed their inventory to fulfill orders, and now waits for
their first named contract. The charges have been placed, fuses have been
armed, and now the market waits for the green light to move ahead.
Since
early Oct. 2008, the
Company has been announcing strong brand name clients for their CryoPort
Express(TM) cold-chain shipping pilot program. Since early in Oct. the
Company has announced pilot programs with DuPont Protection Corp., Quest
Diagnostics, Boston based Mayo Clinic, and just recently Analytical
Bio-Chemistry Laboratories, Inc. (ABC) in India. Although
just initial shipping programs, these announcements mark a
major milestone for moving the CryoPort Express(TM) Shipper into the
commercial phase.
Liquid Nitrogen vs. Dry Ice
What separates CryoPort technology from other cold-chain shippers is their
use of liquid nitrogen (LN2), as opposed to solidified carbon dioxide, or
dry-ice. Using the standard dry-ice model holding times are limited to 1
to 2 days, where LN2 can stand shipping for 8+ days. Another key factor is
dry-ice is defined a hazardous shipping material, where LN2 dry vapor is
not, which could be a major plus when trying to ship overseas and through
individual custom requirements. CryoPort's use of dry vapor LN2, as
opposed to dry-ice, positions the Company as a potential major player
within the cold-chain industry.
Revenue Potential
An Oct. 13,
2008 interview with Wall Street Transcripts, CryoPort's CEO Peter
Berry commented, "Basically, the strategy we have right now is to
remain focused on the clinical trials space. There are four or five very
large companies, multi-billion dollar companies in the space we are
focusing on currently. To give you an example, one of these annually ships
hundreds of thousands of frozen packages a year. That translates into
revenues for us in the $20 million to $25 million range. That's without
counting in the Federal Express portion of the revenue stream. So you can
see that by focusing just on the top four or five clinical trial
companies, you can build a $50 to $100 million business."
If CryoPort can begin closing new shipping contracts for their CryoPort
Express(TM) you could see a dramatic increase in revenue growth within the
Company. That one shipper mentioned in the interview could equate into $20
to $25 million in sales alone, which equals the current total market cap
of the stock currently. Trading at 5 times sales, that would give CYRX a
market cap valuation of $100 million, or a share price of $2.50 a share,
just based on that one shipper alone.
Equity Rating and Price Target
With the potential for $50 to $100 million in revenue sales, and $20 to
$25 million with one shipper alone, the Company is trading well below its
potential price to sales ratio. The announcements of new large named
biotech and pharma companies on their pilot shipping program only
positions CryoPort that much closer to announcing its first large
contract. At a conservative 3 times sales, the Company holds the potential
of $150 to $300 million market cap, which would equate to $3.80 to $7.50
per share.
Thus, regarding these recent announcements, Ludlow BioVentures is
upgrading its rating from B- to B+, and maintaing its near-term price target
to $3.00 per share.
Meehan Capital Research Report
Meehan Capital
Management Group, Inc., a Registered Investment Advisor located in Central
Florida, has put together a very comprehensive
22-page research report and breakdown for CryoPort that investors may find
of interest. The report provide a very detailed outlook for the Company,
with a 12 to 18 month price target of $7.50 per share. For investors
seeking additional information on CryoPort, and their potential going
forward, this report may be a great way to learn more.
 http://www.meehancapital.com/research.html
What to Look for Next
This section gives investors a general idea on what next to watch for to
indicate the company is moving forward on their business plan.
For CryoPort, Inc., it's all about signing name brand firms for their
Cryoport System. Any news of new biotech clients for their cold chain
shipping system will indicate the company is moving ahead, and taking the
next step in its business model. The recent agreement with DuPont Corp
Protection, Quest Diagnostic, Mayo Clinic, and ABC
Laboratories are major steps in that direction.
Technical Analysis
The stock has testing its lows from early July in what many call a 'double
bottom, and is currently trading below their 50
day moving average at $0.50 a share. Any move
above the 50 or 200 day moving average could indicate a very bullish marker. The
MACD and RSI are both indicating a turn around in the overall trend, and may
indicate a turn to the upside from here.
About CryoPort
CryoPort develops leading edge,
proprietary, technology-driven shipping and storage products for use in
the rapidly growing global biotechnology and biopharmaceutical cold chain.
The products developed by CryoPort are essential components of the
infrastructure required for the testing, research and end user delivery of
temperature-sensitive medicines and biomaterials in an increasingly
complex logistical environment. www.CryoPort.com
About Ludlow BioVentures, Inc
Based in New York City, Ludlow BioVenture
is a venture capital and research advisory firm with a specific focus on
the biotechnology sector. The goal of the firm is to
promote investments into biotech
ventures worldwide. Ludlow BioVentures owns and operates the Ludlow
BioVenture Index, which tracks a wide basket of US traded large and small
cap biotechnology stocks. www.ludlowcapital.com/bioventures/
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Contact:
Ludlow BioVentures, Inc.
Research Department
Phone: (917) 670-0843
Email: info@ludlowcapital.com
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