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Also - watching ISRG today.. Just want everyone to know that they trade at 9x revenues ($19B market cap on $2.1B sales. A similar valuation of Titan in 2017 could put TITXF at $1B+ market cap or approx $9.75 share price.
Titan mentioned in Robotics article.. Given ISRG is the biggest player, and only has $2B in revenues now, there is a lot of room for other players by 2018.
Key takeway..
Estimated to be worth US$3.77 billion in 2011, the surgical robots segment of the medical robotic systems market is projected to be worth US$8.47 billion by 2018, expanding at a compound annual growth rate of 11.5% between 2012 and 2018.
http://www.whatech.com/market-research-reports/press-release/medical/39848-discover-global-medical-robotic-systems-market-that-is-expected-to-be-worth-us-13-64-billion-by-2018
All right now bring on Feb12!
Confirmed - so, let me tell you my estimate for Q4 spending.
Net $4.5MM loss
$4.0 cashflow out (some warrant loss and options, etc,)
$1.2 (hopefully more) warrant $$
Results in $2.8MM Cash spent in Q4.
Current cash Balance as of end of Q4 - $34.8MM
- less warrant liability whatever that value is calculated to be, and any other possible accrued liabilities (things for Q1 that were pulled forward).
In fact Honey, if I read between the lines, they have cash on hand (vs. in term deposits) as per SEDAR filing as follows at end of Q3. To me could be indicative of their estimated cash spend for Q4? Term deposits are typically 30,60,90+ days so just speculating..
Cash
$2,306,306
Term Deposits
$35,319,449
Q1 spending estimate of $11MM subtracting the above leaves about $6.5MM loss, again of which warrants and such will leave a cash draink of about $5MM and a Q1 exit cash position of $30MM.. Just IMHO of course. We'll find out in about 3 weeks.
For Warrant info - please review the current and linked below warrant timetable and details. Notice prices in CAD. This is for those pro or con on warrant based financing
http://www.titanmedicalinc.com/wp-content/uploads/2014/05/Titan-Medical-Inc.-Warrants.pdf
You'll also know that since the CAD has weakened against the USD, it takes a lower TITXF price to hit the exercise price for these warrants.
IN FACT, at the current TMD closing price of $1.48, the C warrants are in the money, and for any holder, or broker, that received the warrants free as part of financing, they have been, and will continue to exercise (again review the SEDAR filings to confirm what I'm saying, $1.1Million was exercised between Sept 30 and Nov 12 alone!!). Others may hold in hopes of leveraged gains and eventually sell, and those too will be exchange for shares, as in the money warrants will not be just left alone to expire.
Now the B's are only 27 cents away from being in the money, which I anticipate we should hit sometime in 2015, and therefore I believe the financing risk is moot for upto Q2 2017 (or launch date).
To say it again, simply converting the B's and C's, the company will easily fill the $6-8MM hole in funding.
NOW, thinking beyond launch, or for exceptions before launch...
To ensure there is more than enough for launch, the stock price needs to hit just $2.01 or slightly higher for almost 19MM shares at approx $1.97 price, or almost $38MM to be available. That's Canadian, or approx $1.65 USD...
Also, the E's never have to be in the money, and this company will be well financed. I will be sharing this with Titan the next time I speak to gauge their reaction and hope they nod saying yes, we know, nothing to worry about.
The simple answer is warrants have a way of pricing themselves that ultimately makes it worth converting to stock. It's called time premium. Right now for example the E warrants are worth 10 cents despite not being in the money. If the stock went to 2.75 right now the warrants would likely be worth 60 cents in time premium. Big the stock now stayed at 2.75 until April 2017 the warrants would slowly dwindle down to 0 value. If the stock went to 2.76 the warrant would be worth somewhere between 0 and 1 cent this making it cheaper to buy a warrant and convert than to buy the stock. This is extreme example but is exactly what will happen if the stock price is near each warrant price for each warrant.
Also I do agree with you many warrants have been sold on open market but as a warrant holder most of the nonE warrants are trading with thin volume
Hi, I would imagine that most of the big time holders of the warrants received them free as part of the financing deal, so, even if Titan is 1 penny over, there is incentive to convert to shares and help the company out. In Oct/Nov of 2014 alone, this took place (read the last paragraph of the Q3 financial statements filing).
Hey Point do you have to do anything for Yahoo finance and Google to pickup your article like last time?
Hey, I'm not sure I'm left in the dark wondering what is going on, and I believe many feel that there is sufficient information to make an investment decision on. If I could help you get an answer, what question would you ask?
I believe I'm looking at my email summary from last conversation stating it was inclusive. Look below for my own DD results..
**************
Starting Cash: 37.2MM Q3
Existing Spend Plan:
7.2 spent by end of Q1
20.4 for rest of 2015
Warrant liability impact on cash?
Total approx $28MM
Current Spend Plan:
11 spent by end of Q1 (3.8MM more that before)
17 spent by Q4 (3.4 less than before)
10MM spent by Q2 2016
6 MM to production (2017) - this seems low?
Total approx $44MM
Result: Short by 6MM or more by around Q2 2016?
Conclusion:
Funding required, either via another round or via warrants. Their strategy should be locked by end of Q42015 or early Q1 2016 to limit financing and dilution risk. Therefore if they go warrant route, they should have the stock above $2.50 by end of Q4, 2015. This is going to be my new outlook, and aligns nicely to when the prototypes are being used, and they become a "Clinical stage company from a development stage company". I looked at other startups and when they goto clinical study stage, they usually get a nice bump in the PPS.
Scour the Q4 filing and see if anything has changed. My gut tells me that $11MM hasn't been fully spent Q4 2014/Q1 2015 as planned, and that given $1.1MM in warrants were exercised since Sept30th, the cash burn rate is likely nowhere near as high.
If I'm not mistaken based on my chat with Randall those were all in costs and therefore the burn rates don't apply. I can double confirm tho
I don't see them killing off the warrants from the previous investors just to provide warrants to new investors (basically get the same dilution effect). The new investor would want shares and warrants and if the stock is near $1.25, then that's 40+MM shares anyways.
Thanks for posting and thanks Point for writing this up. Great article..
I'm fairly sure its not Randall leaving, rather a new hire...
Hi - just reading through this again and wondering what your thoughts are on the date of this.. 2009 and filed in 2012, both dates pre-dating the SPORT. I wonder if this Amadeus tech applies to SPORT?
If the year-end results are still on track for Feb12, then yes I expect to hear some good news.. I don't believe we will hear about the January milestone until then either.
Guess we'll all see what plays out! Thanks for responding
Hi Dak, (and ORRep, and others), are you employed or connected with any of the hospitals that the SAB doctors work at? It is my belief that sometime in Q4 of this year they will be getting prototype SPORTS to begin testing with. It would be cool if we had an inside connection to at least one of these (if my assumption is correct).
Thanks
Thanks for posting. You win the best contribution award of 2015!
Thanks for your thoughts on this. This is why I believe they went for additional indications, as they weren't quite ready on this yet, and needed to spend more time. So, why not add in additional indications for FDA approval at the same time? Its pennys on the dollar relative to what they're spending on fine tuning. JMHO, and for this reason it's why I think their timelines are padded..
Thanks for confirming the job was filled
I was told by Titan that on Feb 12, 2015 year-end results would be made public. Wonder who's right?
OR, Dak, what are your thoughts on the intuitiveness and precision of the controllers used by the human operator? I feel this is the area they could spend months on as it's 'fine tuning' and very much software oriented.
My math tells me warrants (simply the 2015 and 2016 ones, not the 2017 ones or beyond) will be enough to fund them. I'll bet a round or two in Vegas on this even.
One thing to think about is that was accounting loss per month not cash burn rate per month. Take another look (I will as well) but I believe cash burn per quarter was only $800K..
I've been buying E each time I get it for 10 cents
Is there such a thing as double bingo? I agree !
Its been filled (second time answering) Doubt me, call them yourself and ask if the accounting manager role has been hired or can you still apply?
Guys, there is lots of info being dropped as nuggets on this board, its amazing that nobody sees it. When you piece together the nuggets it points to a company that is doing almost exactly what Titan Management has said they are doing (hehe)
I believe they found their guy...
Not always. Market makers create liquidity where none exists which makes it appear as though there is a buyer for every seller...
Well said.
Honey - can you create a sticky that captures questions for the AGM please? I recommend everyone post/edit/update these so everyone feels prepared to attend, if not in person, in spirit.
My first question, if you believe it to be good enough for this new thread, is;
1) Can you confirm you're on track with prototype build by end of year. Specifically is the vendor chosen to build, can you confirm who this is? Can you confirm how many prototypes, and their physical placement, and all this detail, is planned, or being planned. Lastly are you still on track with current funding?
I guess because they become documented in formal minutes and are forever available for reference? And they become public domain? Much more formal than the info portrayed via a drop-in, phone call, or visit at a booth that we've all experienced lately?
I'm also in the camp that says they only found out about the FDA and customer feedback within the last 6 months, otherwise they would have disclosed (and would NEED to disclose this) in the Q2 filing. While I think their "gut" told them this was an option through Q2, I think it became a must-do in Q3.
May I recommend you attend the AGM this year? I plan on being there to ask some questions myself
My recommendations on this topic;
1) It would be stupid for us to support any lawsuit of any nature
2) We should band together, setup a conference call, do whatever it takes to establish a list of "requests" that has say at least 5-10% of shareholder votes attached, and then present this at the AGM in May time-frame.
3) Always remember we're investing in a startup, with no sales, who meets their minimum reporting requirements and then some.
I believe they will find a way to exercise all. Price will be at or above 2 bucks...
None regarding share price specifically
When I posted the warrant exercising, there were 102,555,338 shares outstanding. When the annual numbers are posted, I'm curious to know how many more warrants were converted during the period and upto Feb 10, 2015 (the day)
Actually they also mentioned DOD was interested in SPORT for robotic surgeries due to its size and ability to be mobile.
Guys it's a medical tech startup. This isn't IBM where you have expectations of blue chip risk aversion. Everyone has to be able to accept a lot higher risk. This stock also is OTC again another reason it's not IBM. They have not met minimum standards of a less riskier company. Lastly their April prospectus and filings were stamped full of risks. There were no guarantees so not sure why everyone felt this was a no risk stock?
Don't get me wrong I'm disappointed too but not entirely shocked. Just averaged down and doing more DD about this so not caught again.