ADK stock keeps “Top Pick” rating at Echelon

Heading into the fourth quarter, Echelon Capital Markets analyst Stefan Quenneville still thinks highly of Diagnos (Diagnos Stock Quote, Chart, News, Analysts, Financials TSXV:ADK).

In a research update to clients October 3, the analyst maintained his “Speculative Buy” rating and one-year price target of $1.00 on ADK, implying a return of 88 per cent at the time of publication.

Quenneille said an existing understanding might soon lead to something more substantive.

“DIAGNOS Inc. remains a Top Pick with the expectation that the August 2021 MoU with EssilorLuxottica (EL-MIL, NR), the world’s largest eye care company, will be converted to a contract to commercialize the AI-based FLAIRE platform to screen for Diabetic Retinopathy (DR), the leading cause of adult blindness, in up to 8,000-10,000 of its worldwide locations,” the analyst said. “Often undetected due to screening bottlenecks, DR progresses asymptomatically until irreversible vision loss occurs. ADK’s equipment-agnostic platform seamlessly integrates with existing optometry cameras and workflows to enable early detection, grading, and monitoring of DR, which can be difficult and time-consuming using current manual approaches.”

The analyst thinks ADK will produce EBITDA of negative $2.0-million on revenue of $500,000. He expects those numbers will improve to EBITDA of negative $1.8-million on a topline of $1.6-million.