Original-Research: MagForce AG - von GBC AG
Einstufung von GBC AG zu MagForce AG
Unternehmen: MagForce AG
Anlass der Studie: Research Comment
Kursziel: 11.00 EUR
Kursziel auf Sicht von: 31.12.2021
Analyst: Cosmin Filker, Marcel Goldmann
Capital increase of EUR4.7m successfully implemented to finance growth strategy, high share price potential, BUY rating confirmed
Since our last research study (see research study dated 12.11.2020), the share price of MagForce AG has developed significantly positively. Within just one month, the share price has risen significantly by approximately 115% from EUR2.50 to the current level of EUR5.38. Against this background, the capital increase carried out by the company is easily understandable. According to the company's announcement of 15 December 2020, a total of 1.17 million new shares, which corresponds to 4.2% of the share capital, were successfully placed with institutional and qualified investors at a price of EUR 4.00. In total, the issue proceeds amount to around EUR 4.7 million. The newly raised funds will be used to finance the growth strategy and strengthen the balance sheet overall.
The growth strategy includes the continuation and acceleration of the roll- out of the MagForce treatment technology in Europe. For this purpose, it is planned to build treatment devices and install them at focal centres for the treatment of brain tumours. Most recently, the company announced the successful commissioning of the treatment centre at the Hufeland Clinic in Mühlhausen. Now that the final acceptance test has taken place, the first brain tumour patients at this hospital are to be treated with MagForce technology as early as December. With this installation, the company now has three treatment locations in Germany and one in Poland. Although expansion activities in other European countries were delayed this year due to the Covid 19 pandemic, new devices are to be installed here in 2021, particularly in Spain and Italy, and the treatment base is to be significantly expanded.
At the same time, the prostate cancer treatment study in the USA is being conducted by the subsidiary MagForce USA, Inc. Start of the final stage of the study, Stage 2b, is expected to begin in early 2021. While the study is being completed, MagForce will already begin preparations for commercialization, which is anticipated to start in mid or the second half of 2021.
MagForce AG has established several options for financing these two commercialisation paths of the MagForce technology. In addition to the current successful capital increase, the Company has concluded a financing agreement with the European Investment Bank (EIB) for a total of EUR35 million, of which a total of EUR13 million had been drawn down as at the reporting date of 30 June 2020. In addition, a convertible bond programme totalling EUR15 million was agreed with Yorkville. As of the reporting date 30 June 2020, convertible bonds totalling EUR 2.5 million had been issued.
We have included the current capital increase in our DCF valuation model and confirmed the target price of EUR 11.00 (previously: EUR 11.00). In addition to a slight price target reduction, which is purely technical in nature, the capital increase has slightly reduced the risk. Both effects cancel each other out. We continue to assign the rating BUY.
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Date (time) of completion: 17/12/2020 (4:52 pm)
Date (Time) first distribution: 18/12/2020 (9:30 am)
übermittelt durch die EQS Group AG.
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