Since announcing sales executive Greg Blair as vice president of business development May 17, and pushing out former CEO Stephanie Morley, Zomedica (NYSEAMERICAN:ZOM) has gone on radio silence. That’s not good for ZOM stock.
Zomedica has had its Truforma blood-testing kit for animals on the market since March. It is due to announce results for the second quarter on Aug. 11. Until then it seems investors will have nothing to go on.
Before Cohen joined, Zomedica had been taking investors on a ride, rising to as much as $2.70 per share. Morley had gotten controversial Tiger King star Carole Baskin to give a video endorsement of Truforma.
Zomedica is trading now at 83 cents. That’s a market cap of $800 million.
Zomedica announced first quarter results on May 12. There was little for investors to chew on. Revenue was $14,124 and expenses were less than $4 million, but there was $276 million in the bank from stock sales. The results indicate Zomedica can finance marketing of Truforma, which uses acoustic waves to test blood samples for things like adrenal disease.
Zomedica got its technology from Qorvo (NASDAQ:QRVO), a $20 billion radio wave analysis company. Qorvo had developed Bulk Acoustic Wave sensors for analyzing radio signals, selling its gear to aerospace and telecom companies.
In addition to calling on vet networks, which have been scaling up as pet owners seek higher-quality care, Zomedica is also trying to certify assays to identify more pet diseases. The more tests Truforma can do, the easier it will be for vets to justify the expense.
Meanwhile, analysts have almost nothing to speculate on, which is why ZOM stock is now locked in a trading range, below $1. Shares have not traded above $1 since late April.
In May I predicted that Zomedica investors would know whether Truforma was a hit by Christmas, but that was just a guess. August might be a better guess. Truforma’s tests for adrenal and thyroid conditions may be great, but vets must measure their value against the system’s cost.
While we wait, colleagues like Josh Enomoto are left to measure the potential value of Zomedica’s market. According to the American Pet Products Association (APPA), veterinary care is a $31.4 billion market. This means that, if Truforma demonstrates value, it should get sales.
The lack of news means Zomedica stock has no catalysts to lift it, writes our Thomas Niel. That means the stock price could fall further before the August results.
Even Reddit traders seem to have lost patience. One commenter said he’d be happy to hear what Zomedica officers had for breakfast at this point.
The Bottom Line on ZOM Stock
If you got into Zomedica at the top, you can either take a big loss or wait until August.
If you haven’t yet bought Zomedica stock, you have a little over a month to decide. You might drop by your local vet surgery and ask if they’ve heard of the device, or the technology. At this point, amateur market surveys are as useful a tool as any for making an investment decision.
I don’t think Zomedica has been a pump-and-dump. I think it’s a small company with an interesting device. Morley’s search for publicity may come back to haunt the company if results don’t come through. But as with everything else, we’ll know later.
On the date of publication, Dana Blankenhorn did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Dana Blankenhorn has been a financial and technology journalist since 1978. He is the author of Technology’s Big Bang: Yesterday, Today and Tomorrow with Moore’s Law, available at the Amazon Kindle store. Write him at email@example.com or tweet him at @danablankenhorn. He writes a Substack newsletter, Facing the Future, which covers technology, markets, and politics.