Echelon Wealth Partners analyst Gianluca Tucci thinks there is a ton of upside to be had in Nubeva Technologies (Nubeva Technologies Stock Quote, Chart TSXV:NBVA), but the analyts’s most recent report has him tempering expectations slightly.
In a research update to clients Wednesday, Tucci maintained his “Speculative Buy” rating, but lowered his one-year price target on Nubeva from $1.50 to $1.20, implying a return of 243 per cent at the time of publication.
The analyst explained his reasoning.
“We are bullish on the company’s pivot to focus on Prisms ahead of StratusEdge,” Tucci said. “We believe that this will lead to incremental longer term shareholder gains. However, we have tempered our near term momentum expectations as we wait for the prisms to gain customer trials and more importantly commercial adoption. In the context of a TSXV that declined 35% for 2018 and with an applicable ~20% discount rate within DCF valuations, we are reducing our PT by 20% to C$1.20 reflecting timing considerations and looking for visibility on a ramp in commercial revenues.”
Tucci thinks Nubeva will post Adjusted EBITDA of negative $1.4-million (all figures USD) on revenue of $2.4-million in fiscal 2019. He expects those numbers will improve to EBITDA of negative $200,000 on a topline of $1.9-million the following year.