Profound Medical Corp (PROF)

[Lazerking40]

Already approaching 100% since the publication of that article.

[chocolate man]

Thank you hayfarmer!

[Lazerking40]

All in all, I guess it's just another boring day here......LOL

[hayfarmer]

RJ on PROF in Cantech letter:

Dec 1, 2022

Profound Medical has a 215 per cent upside, says Raymond James

Raymond James is staying bullish on medical tech company Profound Medical (Profound Medical Stock Quote, Charts, News, Analysts, Financials NASDAQ:PROF), with analyst Rahul Sarugaser reiterating a “Strong Buy” rating on the stock in a Thursday update to clients.

Raymond James attended meetings this week in Chicago for the Radiological Society of North America, where Profound Medical presented two scientific sessions and three educational exhibits. Profound is currently in the middle of commercializing the TULSA-PRO, a combined MRI and ultrasound device for the ablation of pathologic prostate tissue, and the company received 510(k) marketing authorization in the US in 2019 and is now installing TULSA-PRO units across the country.

On the meetings, Sarugaser said the “very strong” safety profile on the TULSA-PRO demonstrated in the company’s four-year pivotal follow-up data stood in stark contrast to the much poorer standard-of-care’s surgery outcomes. This left the radiologist physician audience “visibly and audibly impressed,” Sarugaser said.

“New analyses demonstrate that as TULSA operators’ experience with the procedure increases, patients’ already-low treatment-associated adverse event (AE) profile improves further (ED: 0 per cent, down from 13 per cent; UI: stable at one per cent). Also, the data show TULSA’s broadening utility into BPH: 85 per cent of patients’ BPH symptoms resolved following TULSA treatment,” Sarugaser wrote.

Overall, Sarugaser said Profound presented limited new data at the meetings, leaving him watching for the FARP trial results in March of 2023 and then the CAPTAIN trial’s 12-month topline readout in mid-2024, both potential catalysts for the stock, he said.

At the same time, Sarugaser pointed to a session talk by Dr. Ali Bassir of UCLS School of Medicine who highlighted the TULSA-PRO’s four-year data from the company’s TACT trial, which showed a cumulative adverse event (AE) rate of urinary incontinence and erectile dysfunction at about 13 per cent.

“This was in stark contrast to an AE rate of ~75 per cent shown in a previously-presented talk on a laser-ablation technology, the outcomes of which were in-line with the ~75 per cent AE rate seen in standard of care surgery (RP). When presented with PROF’s data, we noted distinct ‘impressed’ expressions on the faces of the radiologist physician audience,” he said.

Sarugaser said in a second session, Dr. Leonhard Steinmeister from Alta Klink in Germany presented on retrospective outcomes from 100 patients on the TULSA-PRO, with results including zero per cent erectile disfunction, one patient with worsened urinary incontinence and 85 per cent symptom relief.

“This latter presentation tells us that, with improving operator experience, AEs associated with TULSA continue to improve beyond the TACT 4-yr data. While UI remained consistent at ~1 per cent, rates of ED improved from 13 per cent to 0 per cent. Equally importantly, with 85 per cent of patients experiencing BPH relief, this study demonstrated broadening utility of TULSA into BPH,” Sarugaser wrote.

With his “Strong Buy” rating, Sarugaser maintained a target price of US$15.00 on PROF, implying at press time a projected one-year return of 215 per cent.

[Lazerking40]

Either works for me.

[chocolate man]

I would like to see it consolidate in the 7 range for the rest of the year and continue its climb starting in January. If it goes to 8 or higher in the next two weeks i certainly won't be disappointed.

[Lazerking40]

I agree that it is way undervalued, but they earned that small MC with their super slow rollout and lackluster sales. Hopefully, they start tapping the potential of their tech so we can get a decent payday. Recent movement is nice. Could see a solid 7 today or tomorrow if trend continues.

[chocolate man]

We have a 7.07 print in AH.

[chocolate man]

It only has a market cap of 133 M.

[Lazerking40]

Can we keep this momentum? Let's hope so!

[chocolate man]

Great find, thank you for sharing!

[Lazerking40]

Maybe.

https://biotuesdays.com/2022/12/09/ut-southwestern-performs-100th-procedure-with-profounds-tulsa-pro/

[chocolate man]

A run to 7 on this move?

[chocolate man]

You could be correct,

[Lazerking40]

I hope you are right. I tend to think it is some institutions buying back some of their tax losses. What I am hearing (from TV so take that for what it is) is most institutions have completed their tax loss selling. Some will undoubtedly buy back to reestablish positions. I think that is what is going on. Purely speculative on my part

[chocolate man]

Trading like there is some good news coming out in the near future

[chocolate man]

I've been buying the last couple of days.

[Lazerking40]

Well, glad they got a loan and are not raising capital at these levels. How low can we go here?

[Lazerking40]

Thanks

[chocolate man]

Thank you Hay, I will be adding to my position.

[hayfarmer]

Here is the RJ write up

Profound Medical scores rating upgrade from Raymond James

Even with its share price down substantially over the past year and a half, Raymond James analyst Rahul Sarugaser is raising the roof over Profound Medical Corp (Profound Medical Stock Quote, Charts, News, Analysts, Financials NASDAQ:PROF), saying the stock now deserves a ratings boost after the company’s report of strong traction in the US market for its TULSA-PRO medical device.

In an update to clients on Thursday, Sarugaser increased his rating from “Outperform” to “Strong Buy” while maintaining a $15.00 target price, good for a projected return at the time of publication of 283 per cent.

Profound Medical, which is commercializing the TULSA-PRO medical device for the incision-free ablation of prostate tissue, announced its third quarter 2022 results on Thursday, reporting $2.0 million in revenue compared to $2.5 million a year earlier and an EBITDA loss of $6.7 million. (All figures in US dollars.)

“As clinical data continue to demonstrate that TULSA is the best modality when it comes to prostate cancer treatment outcomes and side effects, and more physicians learn of our technology’s flexibility to treat an unrivalled variety of prostate disease patients, our confidence is growing in its potential to change the current standard of care,” said CEO and Chairman Dr. Arun Menawat in a press release.

“Among the keys to reaching that level of long-term success will be continuing to expand our installed base of TULSA-PRO systems and helping to drive increased per-site utilization,” he said.

On the Q3 top and bottom lines, Sarugaser said the $2.0 million in revenue was better than his forecast at $1.8 million but under the consensus at $2.2 million, while the EBITDA loss of $6.7 million compared to Sarugaser’s call at negative $6.8 million and the Street’s $6.5 million.

But it’s the road ahead that’s looking better, according to Sarugaser, who said that during Profound’s Q3 conference call, management revealed “some very promising glimmers of traction and broadening clinical applicability across its installed base,” saying that the number of installed TULSA-PRO devices would go from a current 30 to 34 by the year’s end.

Further, management said multiple installed sites are reporting four to six-month, fully-scheduled wait lists, while one teaching hospital reported that 25 per cent of all prostate cancer removals are being performed using the TULSA (75 per cent surgery). And management said another teaching hospital now uses TULSA for BPH, and yet another for palliative prostate cancer treatments, which is beyond TULSA’s core application in intermediate prostate cancer.

“We are raising our rating on Profound Medical to Strong Buy given our base case scenario analysis implying a 5x return on PROF’s stock over the next 24 months. Even our bear case scenario implies a 3x return over 24 months,” Sarugaser wrote.

[Lazerking40]

Could be. I am even thinking of taking a tax loss here and reentering Q1 of next year. These guys don't PR much so probably no pops between now and then.

[chocolate man]

I think after all the tax selling we can see 7 or higher in January.

[Lazerking40]

Yeah, RJ has been an advocate for quite a while. Current target represents big upside, but is well off their hugh mark target a couple years ago

[chocolate man]

We received a nice report from RJ the day after the conference call. That was why the stock moved from the low 4's to the low 5's.

[Lazerking40]

Same.

[chocolate man]

I bought a lot of stock between 0.70-0.80 before the reverse split. I also sold some stock in the $20's.

[Lazerking40]

Thanks for reminding me that I was holding this same stock at $15.......LOL. Been here 3 years or so. I actually sold quite a bit between $22 - $25 for a nice gain and kept a core.....and it has dropped ever since....but I still think this ends up most likely getting good traction and eventually sold. That's kinda been my thesis here based on current management's prior dealings. Still think that could happen. But need it back up to the $20's and hoping for a 2x from that buyout. Probably a few years away at this pace for that dream scenario

[chocolate man]

I think if we were a $15.00 stock before the conference call, we might be trading in the $10-12 range this morning. The fact we were trading near $4.00 yesterday and in MHO way oversold I think that is why we are seeing the pop this morning. To your point this is now trading on potential and we have to look out to 2023. I'm expecting to see a fairly optimistic report from RJ.

[Lazerking40]

It is nice to see this little pop with volume well above recent averages although still light. I am long and think there is still potential here, especially at the current levels. I just wasn't enamored with the call yesterday.

[chocolate man]

Someone liked what they heard on the conference call.

[Lazerking40]

They mentioned that most of their current installs are in more teaching and lower volume hospitals and they are currently going into more high volume locations that should increase sales. Mentioned insurance reimbursements holding some back, and it sounded like as more data comes in at longer term intervals since the procedure is collected will strengthen their case for wider adoption. The call was positive but also filled with softball questions. I think some tougher questions are required this far into the rollout. Just my opinion.

[chocolate man]

Please listen to the replay and i think some of your questions will be answered. I think it was a good conference call and going forward I think it looks good for the company.
I think Raymond James asked some good qurestions and it appeared he liked the answers. I'm looking forward to their next update on the company.

[hayfarmer]

I'm more concerned that existing installations are not generative revenue. Why? Is it because no one willing to pay cash or because patients or dr's don't want to use it?

[chocolate man]

The 35th installation will be in January 23.

[chocolate man]

Thank you very much! I was able to hear the whole conference call.

[Lazerking40]

Sorry, but not really. Tried to listen at work but was one of those days.....I think they said they are up to about 35 installations by q1. The overall tone didn't really seem overly exciting. They are still high on the future and all, but with everything they were saying, all I was hearing was wait till next year.....They did say that with the 10m loan, no need to raise capital in the forseable future. I only caught pieces. People in and out of my office the whole freaking time!

[hayfarmer]

I can't listen in until they post a recording. Can you summarize? The revenue was pitiful.

[Lazerking40]

Not impressed with PR. Hope they have good things to say.

[Lazerking40]

https://edge.media-server.com/mmc/p/ituvnnuk

[chocolate man]

Do you have the phone number for the conference call today?

[Lazerking40]

I am really hoping for some positive news tomorrow with strong growth in the quarter. Yes, I want to heart about future installs and sales potential, but I feel it is even more important to show actual Q3 results. If we're only going to hear from these guys 4 times a year, it needs to be substantial. We have no momentum and PROF feels stagnant right now.

[hayfarmer]

The next couple quarters are important to measure adoption. Tulsa is clearly the best solution out there. If the 25+ installations still do not generate revenue it would tell me not many people are willing or able to pay cash. Insurance is only taken at hospitals I think and only covers part of the cost by my understanding. When I first bought it the company felt 5% of the market would be willing to pay cash.

So if revenues do not go up substantially in this and next quarter we may be looking at a long wait for the CPT code.

[Lazerking40]

Hard to put value on PROF. The push to $30ish kinda showed the market believed in its potential, but a meandering slow roll out, lagging sales and a lot of ambiguity around reimbursements coupled with very little news to get excited about from management has left PROF seemingly forgotten about. Volume speaks volumes. Regarding being an acquisition target: I thought that 2 years ago, but not so much right now. If it was, why not buy on the open market now and get up to a 5 or 10% stake at these levels? All in all, I think the potential is still there, but I remain dissapointed at the moment. Hopefully we see increased adoption of our technology and substantial revenue increases in the next few quarters.

[chocolate man]

Meant to say he bought $350,000 worth of stock, not $350.00.

[chocolate man]

I have no idea what is going on with the share price. I would have to believe with the stock trading almost at cash value that someone is looking to make an offer for Profound. What value do you put on our technology? Remember the CEO bought $350,00 of PROF at around $7.00 a share.

[Lazerking40]

Never thought it would end up here. Very slow grinding plan and execution makes it hard to generate any excitement. There is no volume. Honestly do not know what to do with this right now. Gotta think it is at or near the bottom so why sell? But at this point, I may want the tax loss. I had a lot of faith in their management based on their past successes, but I am disappointed right now. And we are past the COVID excuse. They just need to execute. Could it be that we over estimated Tulsa's potential?

[hayfarmer]

This one getting to ridiculous levels now. Market cap of 66 million and the company had 53 million in cash at last report. So the technology valued at nearly 0.

[Lazerking40]

That would be a big step in the right direction for sure.

[hayfarmer]

You are right, not sure how I made that mistake. They probably are not getting 4 per week across all 25 machines though but half would be 5 million and what is their burn rate 7 million per qtr? Seems like we could be getting within a few qtrs of break even if they can really get to 4 proc per week.