Based in Ann Arbor, Michigan, Zomedica (NYSEAMERICAN:ZOM) specializes in veterinary testing and pharmaceutical products. But you don’t have to be a pet lover to trade and profit from ZOM stock.
As we’ll see, this is one of the most affordable stocks on the market. Moreover, a recent price pullback could offer an excellent entry point for new investors or a chance for current shareholders to add to their positions.
Zomedica isn’t a huge company by any means, but it could become a huge growth story of 2021. To this end, the company is taking aggressive steps to commercialize its flagship product.
Just as importantly, Zomedica appears to be in a solid capital position. After delving into the details, you just might find that this small veterinary health business is worthy of a long-term investment.
ZOM Stock at a Glance
Traders seemed relatively calm at the end of 2020, when ZOM stock was trading at around 23 cents. Soon, however, the price action would get pretty wild for this particular stock.
With hardly any warning, the buyers ramped the share price up to $1.30 in January of 2021, and then to a 52-week high of $2.91 on Feb. 8. We’re talking about 10x returns within just a couple of months.
Chasing stocks after vertical moves isn’t necessarily the best policy, and ZOM stock provided an illustration of this. Thus, the share price tumbled below $1 and stayed there for a while.
As of June 14, Zomedica shares are still slightly below the $1 level. The worst part of the decline might be over, and enterprising traders could choose to start a position at this attractive price point.
One Product, Many Features
Zomedica’s primary product is a pet diagnostics platform marketed toward veterinarians.
It’s called Truforma, and it offers a number of essential features:
- Highly sensitive and specific immuno-assays, which enable veterinarians to make clinical decisions faster and more accurately
- Compact design: it’s the size of a shoebox and weighs around seven pounds
- Liquid reagents come pre-loaded inside a sealed disposable cartridge
- Simple installation and user-friendly interface
- Bulk Acoustic Wave technology — the same technology that’s used in aerospace and telecommunications
- Non-optical, fluorescence-free platform
- Delivers accurate, reliable results when assessing complex conditions
Truforma provides veterinarians with technological tools that could save the lives of dogs and cats.
Yet, as important as the clinical implications may be, there needs to be a strong commercialization effort if Zomedica is to profit from Truforma.
That effort is under way in 2021, as Zomedica officially entered the commercialization phase in March with the first recorded purchase of the Truforma system by a veterinarian.
As the old saying goes, a journey of a thousand miles begins with a single step — and Truforma was the first step along the path toward full commercialization.
A Stronger Foundation
In April, Zomedia demonstrated its commitment to this effort when the company announced its intention to expand its direct sales organization.
With that, Zomedia will phase out its distributor-based sales strategy and focus on direct sales in order to “provide a stronger foundation on which to build the marketing and sales of” Truforma and other potential future products, according to CEO Robert Cohen.
Long term, employing a direct sales force could improve Zomedica’s ability to serve its customers and sell products in the veterinary market.
Also importantly, the data shows that Zomedica is sufficiently capitalized to pursue its strategy of commercializing Truforma.
As of March 31, 2021, Zomedica had cash and cash equivalents of approximately $276.6 million. That’s a vast improvement of the roughly $1.5 million recorded a year earlier.
The Takeaway
ZOM stock is down from its peak price, but that’s not necessarily a bad thing at all. If anything, it’s a chance for investors to take a position at a reasonable price level.
As for the company itself, traders should watch for Zomedica’s progress in commercializing Truforma. This will be key to the company’s progress and, over the long term, its profitability.
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On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
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