The ASX All Ords share that’s a better, cheaper buy than Polynovo: Wilsons

Analysts at Wilsons have put the spotlight on one All Ordinaries Index (ASX: XAO) share it prefers over the Polynovo Ltd (ASX: PNV) share price.

Polynovo shares fell 3.23% today to $1.98. For perspective, the All Ordinaries Index climbed 0.22% today.

Let’s take a look at which share the team at Wilsons recommends.

What do analysts recommend?

Wilsons analysts believe Aroa Biosurgery Ltd  (ASX: ARX) is the “best-value growth wound care on the ASX”. Aroa shares soared 10% today.

Following a review of the sector, analysts highlighted they like Aroa’s growth outlook and earnings base. In quotes cited by the Financial Review, analysts Dr Shane Storey and Dr Melissa Benson said:

Valuation analysis highlights that ARX’s three-year revenue growth outlook is almost identical to PNV, yet it trades at multiples (EV/Revenue, EV/EBITDA) >3 times lower than PNV.

The earnings diversification of Aroa’s business provides stability and growth levers that its peers (PNV, Avita Medical Inc (ASX: AVH) do not have afforded to them in the US market.

Aroa highlighted in today’s half-year report it is continuing to build its USA sales team. The company has 35 direct US sales representatives.

Revenue lifted 44% on the prior corresponding period to NZ$28.8 million. The company has now upgraded its FY23 revenue guidance from NZ$51-55 million to NZ$62-64 million. The company expects its EBITDA to break even in FY23.

Meanwhile, Polynovo advised today it has received registration approval for its NovoSorb BTM product in Canada. CEO Swami Raote said:

This registration puts us well on our way to accelerating our global impact.

Aroa share price snapshot

The Polynovo share price has soared 28% in the year to date, while Aroa shares have lost 13%.

For perspective, the All Ords has shed 10% in the year to date.

Polynovo has a market capitalisation of nearly $1.3 billion, while Aroa’s market cap is $303.3 million.

The post The ASX All Ords share that’s a better, cheaper buy than Polynovo: Wilsons appeared first on The Motley Fool Australia.

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More reading

• Why Aroa Biosurgery, Cettire, Estia Health, and Weebit Nano shares are rising
• Monday sell-off: Another ASX 300 director goes on a bargain share-buying spree
• Top brokers name 3 ASX shares to buy next week
• Crashing 20% since mid-August, this ASX 300 share is now ‘undervalued’: expert
• Why Lake, Pilbara Minerals, PointsBet, and PolyNovo shares are charging higher

Motley Fool contributor Monica O’Shea has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended POLYNOVO FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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