The PolyNovo Ltd (ASX: PNV) share price has been one of the best performers on the S&P/ASX 200 Index (ASX: XJO) over the last 12 months.
Since this time last year the medical device company’s shares have climbed a massive 120%.
If we go even further back, the returns get even more impressive.
Three years ago, PolyNovo’s shares were changing hands for 21 cents. Whereas today they are worth 12 times that at $2.60.
Why has the PolyNovo share price been on fire?
Investors have been buying the company’s shares due to the potential of its NovoSorb product, which was developed by CSIRO.
NovoSorb is a dermal scaffold for the regeneration of the skin when lost through extensive surgery or burn.
While this itself is a lucrative ~$1.5 billion market, the company is looking to extend the use of NovoSorb into the hernia device and breast augmentation markets. Combined, these three markets have an addressable opportunity worth an estimated $7.5 billion per year.
If it can successfully penetrate these markets, then the sky could be the limit for its sales and ultimately its shares.
But that hasn’t stopped one of its directors from cashing in some of his shares this week. On Wednesday Non-Executive Director Dr David McQuillan sold 441,687 shares on market for approximately $1.18 million.
The company advised that the sale was made to fund the purchase of property ahead of Dr McQuillan’s move from the United States to Melbourne. Dr McQuillan still holds 770,317 PolyNovo shares.
Should you be selling shares?
While insider selling is rarely good news, the purpose of this sale seems more than reasonable. So, I wouldn’t be panicking just yet.
Though, given that PolyNovo has a market capitalisation of $1.7 billion and first half sales of just $10.18 million, I also wouldn’t be opposed to taking some profit off the table.
PolyNovo clearly has a massive market opportunity, but only time will tell whether it captures a sufficient slice that justifies its current valuation.
Instead of PolyNovo, these dirt cheap shares might be the ones to buy right now…
NEW. The Motley Fool AU Releases Five Cheap and Good Stocks to Buy for 2020 and beyond!….
Our experts here at The Motley Fool Australia have just released a fantastic report, detailing 5 dirt cheap shares that you can buy in 2020.
One stock is an Australian internet darling with a rock solid reputation and an exciting new business line that promises years (or even decades) of growth… while trading at an ultra-low price…
Another is a diversified conglomerate trading over 40% off it’s high, all while offering a fully franked dividend yield over 3%…
Plus 3 more cheap bets that could position you to profit over the next 12 months!
See for yourself now. Simply click here or the link below to scoop up your FREE copy and discover all 5 shares. But you will want to hurry – this free report is available for a brief time only.
More reading
- 5 things to watch on the ASX 200 on Thursday
- 3 easy rules for building a massive ASX share portfolio
- Where to invest $5,000 in ASX growth shares today
- Got $2,000? Here are 2 ASX 200 healthcare shares to buy today
- Here are all the ASX 200 shares that have doubled or more since the bottom of the bear market
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
The post Where next for the PolyNovo share price? appeared first on Motley Fool Australia.
from Motley Fool Australia https://ift.tt/2TMvtZf
Leave a Reply