Vilhelm Ruhr, analyst at Impala Nordic
Vilhelm Ruhr, analyst at Impala Nordic shares a favorite case and which companies he is particularly looking at.
What is your favorite case right now?
One case where I see really good R/R right now is Cinclus Pharma. The company has a promising candidate in e-GERD (reflux disease) that is entering phase 3 studies, with a well-stocked cash flow and no immediate need for financing. The company was listed in the summer, and since then the share has more than halved.
I do not think that the slaughter of valuation that has occurred is reasonable, although some justify it by saying that the company is too late to the ball, or that competition from generics and cheaper alternatives is deterring. It may also be worth mentioning that Cinclus' American peer Phathom has done lousy on the stock exchange.
The feeling right now is that pretty much everyone is biased towards the share and that interest is low. Even if you make conservative assumptions about the potential, I have difficulty getting the share to be expensive around the 20-note mark. With a valuation of 900 MSEK, Cinclus is trading at an Enterprise Value of 250 MSEK, with phase 3a data expected to be released sometime in mid-2026.
With today's low valuation, and strong data to back it up, interest in owning the stock should gradually increase during 2025 according to my thesis. Thus, I do not believe it is impossible at all for the stock to go up 50–100% from here (still below the IPO price) in 1 year's time. That said, it is high risk.
Do you have any cases you are looking at a little extra?
Another case that I like is Flerie. The case is to hold the stock until the end of Q2 2025, when you can redeem shares at NAV. The risk is that you will not be able to redeem your entire position, but my assessment is that you will be able to redeem a majority of your shares. The share has gone up a bit, but the valuation is still just over 10% below NAV. If the share were to dip, I would probably take the opportunity to buy shares.
I have a watchlist with a bunch of companies that I have either owned before or am keen to buy into. For example, I think OssDsign is very exciting, a fast-growing company on its way to profitability.
I also keep an eye on Smarteye, which I have owned on and off. It is a case that I think looks good fundamentally, but where the market has sent the share down just over 40% in a relatively short time. The decline is due, among other things, to concerns about financing, as well as a weak car market in Europe.
In addition, I monitor several companies that have had their valuations slaughtered by the market. Here, most of the companies are a little smaller and often the case is a shorter swing trade. One company I monitor is Garo, which has completely crashed. The stock has gone from hot to stone dead, and there should be a potential beach ball effect in the stock.
Garo has two business areas, Electrification and E-mobility, where both have had tough market conditions recently. In electrification, among other things, reduced construction has had a negative impact, while their sales of electric car chargers have crashed. The fact that insiders have filled up the shares and that the stock is so bombed out means that I think you should have the company on your radar.
