Research Capital Corp analyst Yue Ma is sticking to his \u201cSpeculative Buy\u201d rating on healthcare tech company Newtopia (Newtopia Stock Quote, Chart, News, Analysts, Financials TSXV:NEWU), but he lowered his target price in an update to clients on Friday, saying a dimmer revenue forecast for the second half of 2021 is the culprit. Toronto-based Newtopia is a provider of hyper-personalized, habit-changing disease prevention and reduction programs focusing on type 2 diabetes, heart disease, stroke and weight loss. The company uses genetic, social and behavioural information along with virtual care, digital tools and AI and connected devices to create individualized prevention programs. Newtopia, which debuted on the TSX Venture in May 2020, hit a high of $1.19 this past October but has since been on mostly a downward slope, trading more recently around $0.40. But Ma sees lots of upside from here, pointing to what he called promising recent results from Newtopia\u2019s behavioural trial conducted in collaboration with JPMorgan Chase. The 12-month trial was testing the impact of Newtopia\u2019s habit-changing platform on clinical risk factors of JPMorgan employees at risk for developing chronic diseases. A total of 7,753 subjects were enrolled, exceeding Newtopia\u2019s original expectation of 4,200 participants, with outcomes showing that participants lost a total of 35,833 pounds within 12 months (equal to 4.62 lbs per participant). 84 per cent of enrolled participants engaged with Newtopia\u2019s platform, which was higher than the 50 per cent of the previous Aetna trial, with an average satisfaction score of 8.3\/10 versus an 8.2 average with Newtopia\u2019s current clients, while 33 per cent of participants achieved over five-per-cent weight loss versus 24 per cent achieving over 4.3 per cent weight loss in the Aetna trial. \u201cNewtopia announced a CFO change and promising results of a behavioural trial with the company\u2019s digital habit-changing platform,\u201d Ma wrote. \u201cWe are maintaining our SPECULATIVE BUY rating but reducing our target price from $1.10 to $0.80 as we have reduced our revenue forecasts for H2 2021. Our valuation is based on applying a 7.0x EV\/Sales to our new 2021 revenues estimate of $12.1 million.\u201d Newtopia reported its first quarter 2021 financials on May 20, showing revenue of $2.6 million compared to $3.9 million a year earlier, with 77 per cent of revenue comprised of engagement fee revenue compared to 64 per cent a year earlier. Gross profit for the Q1 was $1.3 million compared to $1.7 million a year earlier and the company\u2019s adjusted operating loss was $1.6 million compared to a loss of $0.8 million for the prior-year period. Newtopia said while its first quarter typically involves higher rates of new product launches with corresponding increases in revenues, COVID-19 caused a delay in rollout of its products to some of its clients. The company said the Q2 should be relatively steady revenue-wise, followed by an increase in topline growth for the third and fourth quarters. \u201cThe first quarter marked a significant expansion of Newtopia's health insurer focus and addressable market as we bring our proven disease prevention model to both the US and Canada for Medicare and provincial health customers, respectively,\u201d said CEO and founder Jeff Ruby in a press release. Ruby said his company is anticipating \u201ca tsunami of chronic disease risk\u201d coming on the heels of the pandemic. \u201cWith increased vaccination counts across North America, and in particular the United States, we are hopeful that our clients will return to their standard operating procedures. Our underlying business remains strong and we look forward to supporting current and prospective clients hoping to mitigate their risks as the world economy fully reopens,\u201d Ruby said. For his part, Ma is now calling for third and fourth quarter revenue of $3.3 million and $3.8 million, respectively, with the numbers down 30 and 34 per cent, respectively, from his previous estimates. For gross profit, he is calling for $1.7 million in the third quarter and $2.0 million in the fourth quarter, down 24 and 31 per cent respectively. For the 2021 and 2022 years, Ma thinks Newtopia will generate revenue of $12.1 million and $20.4 million, respectively, and fully diluted EPS of negative $0.09 per share and $0.02 per share, respectively. In April, Newtopia launched its habit change platform in Canada through a partnership with Eastern Health health authority in Newfoundland and Labrador and Medtronic, a formal partner under Eastern Health\u2019s Innovation Strategy, with the aim of implementing an integrated type 2 diabetes prevention program. The company also recently launched Phase 1 of a campaign with a Fortune 500 apparel and home fashion chain in the US with 90,000 employees and officially launched sales efforts into the Mdicare and Medicare Advantage markets following a successful study by Santa Barbara Actuaries, commissioned by Newtopia. On the latter study, Newtopia said the results show how its programs can provide significant cost savings of up to $1,700 per Medicare Advantage member. \u201cAdding this particular at-risk population to the Newtopia platform expands the Company\u2019s potential target base into the 65 years and older Medicare and MA markets, which together represent 62 million people,\u201d Newtopia said in a press release.