Vishay Precision Group, Inc.

VPG Details

Vishay Precision Group, Inc. (NYSE: VPG) designs, manufacturers, and markets sensors, specialized resistors, and strain gauges leveraging its patented foil technology. Precision foil resistors, foil strain gauges, and other sensors are among VPG's offerings, transforming mechanical impulses into electrical signals for display, processing, and control instrumentation and systems.

Q3FY21 Results:

• Growth in Revenues: The company reported a 21.40% increase in net revenues to USD 81.97 million during Q3FY21 (ended October 02, 2021) from USD 67.53 million during Q3FY20 (ended September 26, 2020), primarily due to higher sales of precision foil resistors in the Test and Measurements market.
• Reduction in Net Income: Its Q3FY21 net income was USD 5.45 million, a slight decline from USD 5.66 million reported in Q3FY20.

• Balance Sheet Position: The company exited the quarter with a cash balance of USD 75.54 million and total outstanding debt of USD 60.69 million.

Key Risks:

• Trade Tariff Risk: VPG carries its production in China, Europe, Canada, Israel, the United States, among other places. As a result, any significant increase in tariffs or other limitations on imports to the US could harm the company's operations and finances.
• Exchange Rate Fluctuation Risk: VPG generates a substantial portion of its revenue in currencies other than USD, thus exposing it to exchange rate fluctuations.

Outlook:

• Revenue Estimate: In its Q3FY21 release, VPG stated that it anticipates generating between USD 86 and 94 million in revenues in Q4FY21, based on constant Q3FY21 exchange rates.

Valuation Methodology: Price/Earnings Per Share Multiple Based Relative Valuation   

(Analysis by Kalkine Group)

• % Premium/(Discount) is based on our assessment of the company's NTM trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.

VPG Daily Technical Chart (Source: REFINITIV)

Stock Recommendation:

VPG's share price has surged 10.00% in the past month and is currently leaning towards the higher end of its 52-week range of USD 27.41 to USD 39.71. The stock is currently trading above its 50 and 200 DMA levels, and its RSI Index is at 70.36. We have valued the stock using the Price/Earnings-based relative valuation methodology and arrived at a target price of USD 42.16.

Considering the company's growth prospects, robust product portfolio, associated risks, and current valuation, we recommend a "Hold" rating on the stock at the current price of USD 38.49, up 0.10% as of November 16, 2021, 1:33 PM ET.

* The reference data in this report has been partly sourced from REFINITIV.

* All forecasted figures and industry information have been taken from REFINITIV.

Trevena, Inc.

TRVN Details

Trevena, Inc. (NASDAQ: TRVN) is a biopharmaceutical organization dedicated to creating and marketing new medicines for individuals with Central Nervous System (CNS) illnesses. It presently offers only one FDA-approved medication, OLINVYK (oliceridine) injection, used for treating people with severe acute pain who require an intravenous opioid analgesic but have failed to respond to other treatments. Other products in its pipeline are TRV250 for treating migraine, TRV734 for opioid use disorder, TRV045 for epilepsy, and TRV027 for acute respiratory distress syndrome and abnormal blood clotting in COVID-19 patients.

Latest News:

• Key Personnel Appointment: On November 11, 2021, TRVN announced the appointment of Ms Patricia Drake as its new Chief Commercial Officer. She previously held the role of Managing Director and CEO at Merck, Sharp & Dohme (MSD) Finland, US Market Operations and Strategy Realization Leader, and Leader of Hospital Business Unit in Canada.

Q3FY21 Results:

• Reporting Product Revenues: TRVN reported total revenue of USD 0.18 million for Q3FY21 (ended September 30, 2021), compared to USD 3.0 million in Q3FY20. It did not report any product revenue in Q3FY20 and the license revenue for the current quarter was USD 69 thousand vs. USD 3.0 million in Q3FY20.
• Expansion of Net Losses: Its net loss increased to USD 13.77 million in Q3FY21 from USD 5.55 million reported in Q3FY20.
• Strong Balance Sheet: The company exited the quarter with a cash balance of USD 78.65 million and total debt of USD 0.01 million.

Key Risks:

• Product Concentration Risk: TRVN's prospects are contingent on the commercial success of OLINVYK, the company's lone product. Physicians' and patients' willingness to prescribe/continue OLINVYK is critical to its commercial success, and their refusal to endorse the drug could affect the company's financial performance.

Outlook:

• Liquidity Estimates: In its Q3FY21 release, the company stated that it has enough cash to manage its operating and capital expenditure needs through Q4FY22.

Valuation Methodology: EV/Sales Multiple Based Relative Valuation  

(Analysis by Kalkine Group)

• % Premium/(Discount) is based on our assessment of the company's NTM trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.

TRVN Daily Technical Chart (Source: REFINITIV)

Stock Recommendation:

TRVN's share price has decreased 29.29% in the past month and is currently leaning towards the lower end of its 52-week range of USD 0.74 to USD 3.10. The stock is currently trading below its 50 and 200 DMA levels, and its RSI Index is at 24.86. We have valued the stock using the EV/Sales-based relative valuation methodology and arrived at a target price of USD 0.96.

Considering the correction in the stock price in the past month, robust product pipeline, and associated risks, we recommend a "Hold" rating on the stock at the current price of USD 0.81, down 5.16% as of November 16, 2021, 11:57 AM ET.

* The reference data in this report has been partly sourced from REFINITIV.

*All forecasted figures and industry information have been taken from REFINITIV.  

Disclaimer

The advice given by Kalkine Canada Advisory Services Inc. and provided on this website is general information only and it does not take into account your investment objectives, financial situation and the particular needs of any particular person. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. The website www.kalkine.ca is published by Kalkine Canada Advisory Services Inc. The link to our Terms & Conditions has been provided please go through them. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations later.