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Thread on Nanox: Everyone is asking me about $NNOX. I mentioned this name as the Pounder's Thesis Pick of the week on @PoundingDaTable. Yes, it's pre-revenue. But here's the thing about markets: they are forward looking, always. IPO investments are based on future belief...
...more than any other investment you can make, because it's an investment from the first second you can take a position. In general, companies at this stage, for the most part, are in their very early stages of development and growth (many exceptions of course these days)...
...Regardless, I am long $NNOX for its potential, that is all. Not because of its 1 day chart or fundamentals, simply because I agree with the need for its technology and revolutionizing its space in general. To start, Nanox is a startup out of Israel that has developed a...
...small, low-cost scanning system and medical screening software ( http://Nanonx.Cloud ; pay-per-scan model) to replace large and costly machines and corresponding software used for X-Rays, CAT scans, PET scans and other body imaging services....
...Today, the annual total addressable market (TAM) for this industry is about $21 billion worldwide annually. While that sounds like a lot, the truth is that there is a massive shortage in the world for these systems in general....
...According to the World Health Organization (WHO), 2/3 of the world's population have no access to medical imaging systems. Many others suffer from weeks and months of wait time for access to systems and diagnostics results. The reason for this is that traditional systems...
...are too complex and expensive for mass deployment to fulfill all needs for them. Most of these scanning machines in use today have a price tag of $1-3 million each. The Nano system is designed to fill this gap, and the current use of standard costly machines too...
...The NANOX.ARC scanner is far more affordable, costing just $10,000 to produce each. The scanner transmits imaging data to its cloud SAAS platform, http://Nano.cloud , which provides secure imaging analysis and billing services..
...The scans take a very small fraction of the time traditional scanners take, allowing for less exposure to radiation for those who need frequent scans, and more scans to be done in general for those who need/want it since the machines will not be stuck in service as today...
...The traditional scanners today weigh an average of 2,000KG, while the Nano.Arc is only 70KG, making it transportable essentially and able to be shipped/set up/used in countries where they otherwise would be unable to receive such large technology...
...Nanox is pre-revenue today, but it has so many deals inked contingent upon FDA approval, set to be granted by the end of Q1 2021. They do not require clinical trials. I'll use one deal to explain their future revenue model:...
...1,000 units are to be purchased and distributed by The Gateway Group in Australia, New Zealand, and Norway in one deal. The price tag on this deal is $174 million, with $50+ million in recurring annual revenue from their SaaS http://nanox.cloud model...
...The cost of the machines is $10,000. So the entire cost of them fulfilling this one order for the scanners is $10 million. That's very interesting for their future revenue/profit. Furthermore, this is just one of a many deals inked and just contingent on this FDA approval:...
...Nanox also signed a strategic collaboration agreement with USARAD for the deployment of 3,000 Nanox Systems in the U.S in February. They also signed an agreement with Promedica Bioelectronics for 500 units in Italy. Another deal in the Asia Pacific region for 500 units...
...to be deployed in Taiwan and Singapore with Golden Vine International. That's already 5,000 units, and they're not even in production yet until FDA approval. Their goal is to disburse 15,000 units by 2024. At this pace, they may need to up their target....
...In terms of their cloud pay-per-scan SaaS model, each of these deals will bring them annual recurring revenue over 30% the initial cost of the units (based on the figures from the deal I described above). They are also working strategically to make their software top notch:...
...Nanox announced an agreement with CureMetrix for AI-Based Assistive Diagnostic Tool to support http://Nanox.Cloud . They partnered with http://Qure.ai to integrate AI-based Medical Imaging Solutions into http://Nanox.Cloud . They're making this a powerhouse...
...Nanox has some pretty significant backers/investors also. They secured $26 million in strategic investments from Foxconn (they make Apple's products...). SK Telecom invested $20 million in Nanox, and recently, another $20 million just back in June...
...They continue to add new future customers, like the deal they signed June 15th in Russia and Belarus for $48 million, also contingent on regulatory approval and acceptance test clearance. They will be global as soon as approval happens...
...Their leadership/advisory team are forces to be reckoned with in my opinion. The CEO, Ran Poliakine, founded the wireless charging industry. Hitoshi Masuya, co-founder, manages Japan Laboratories and originally invested in Nanox with Sony, now leading Japan operations...
...The CFO, Itzhak Maayan, has worked in financial leadership roles for 25 years, notably formerly at Perrigo and Cisco Systems. They CTO, Yoel Raab, is a former Intel and Orbtech Medical executive. The board consists of Erez Meltzer, the Exeutive Chaiman of the..
...board of directors of Hadassah Medical and University Center. Floyd A. Katske, M.D, is the past president of the California Urological Association. In regards to advisors, Marry Blumenfeld is the Chairman of the Advisory board, previously spent 35 years at GE...
...Professor Geoffrey Rubin, formally Chairman of the Department of Radiology at Duke University (wooo, Go Devils Go!). Dr. Michael Yuz, founder and CEO of USARAD. Michael Jackman, Americas Region CEO of GE healthcare... They are not lacking leadership at all in my opinion...
...Now, many don't understand why I like the potential of $NNOX since it has essentially made $0 thus far. Well, I like the "potential," as you can see from all I have written above. IPOs can become the next $0 stock, or the next $ISRG $AMZN $AAPL, on their relative TAM scale...
... I will continue to hold my position in $NNOX, since nothing has changed since the deep dive into the company I have done over the last few weeks. Once they are approved, I would expect people to be much more interested, as fundamentals and growth should speak for itself.
... ...One last thing I have to mention, its market cap is under $1 billion. Think about what it could be if it captures just part of that 21 Billion TAM annually, and the other 2/3 other competitors can’t get into from a price/mobility point. END.
