My valuation model gives MNKD a target share price of $12.40
which gives it 258% upside.
Afrezza is an excellent new treatment for diabetes patients. Afrezza is mealtime rapid acting insulin that is taken through an inhaler removing the need for patients to receive insulin by injecting themselves with needles.
Sales of Afrezza have been slow so far but they will likely pick-up quickly as more patients become aware of this more convenient treatment option. Patients are also used to controlling their insulin levels with injections so they would be reluctant to quickly change over to a new treatment.
Afrezza is an excellent new treatment for diabetes patients. Afrezza is mealtime rapid acting insulin that is taken through an inhaler removing the need for patients to receive insulin by injecting themselves with needles.
Sales of Afrezza have been slow so far but they will likely pick-up quickly as more patients become aware of this more convenient treatment option. Patients are also used to controlling their insulin levels with injections so they would be reluctant to quickly change over to a new treatment.
Mannkind/Sanofi are beginning a direct to consumer
advertising campaign which will help raise awareness of Afrezza and boost its
sales.
Early Afrezza users have been very positive about the new
treatment going by anecdotal twitter testaments. Their positive experiences should
help others also change over to this needleless option.
MNKD is trading at $3.50 levels down from highs of $10.50 around 15 months ago. At this price level I find MNKD a very attractive long-term risk/reward play.
Below is my valuation model with assumptions, I used the Times Revenue Multiple Valuation method.
Disclosure - MNKD is a holding of my Marketocracy Fund. This Fund is available for investment at http://www.marketocracy.com/managers.php?manager=781
Follow the links.
I do not short stocks.
afrezza - at least spell it properly!
ReplyDeleteOops!
ReplyDeletethx Russell.
Branko, do you still recommend Mannkind after the issuance at $2+ on the TASE and the flattening scripts thanks to Sanofi's lackadaisical marketing effort?
ReplyDeleteMany many angry investors out there. Not quite shovels and pitchforks yet but close
Hi Dave!
ReplyDeleteI am holding my MNKD position I rate it as an attractive risk/reward play.
I am not that surprised by the low Afrezza script counts(check my tx growth forecast estimate). It will take time for patients and doctors to become confident using Afrezza. Diabetes is a serious condition so while patients are on something that works they're unlikely to quickly be willing to change their treatments.
Afrezza is a much better option to injecting insulin, as this message grows so will the script count.
MNKD's financial position is our biggest risk while script #s are low.
I see shareholder's anger and impatience with our current state but I do not share their sentiments, my investment here was with a longer-term perspective. I have confidence Afrezza & MNKD will ultimately be successful.