{ "docId": "019dd923-622c-750b-8b9a-ad0811d3e80d", "docSlug": "dfcef8f28a20", "documentTitle": "Accelerate Diagnostics (AXDX)", "authorId": "61_White_Diamond_Research", "authorName": "White Diamond Research", "documentKindSlug": "research-note", "documentKindLabel": "Research note", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2019-09-16 00:00:00", "orientation": "portrait", "aspectRatio": 0.77272725, "pageNumber": 40, "pageCount": 41, "prevPage": 39, "nextPage": 41, "slideType": "thesis_headline", "function": "diagnose_problem", "density": "overcrowded", "nDataPoints": 10, "notes": "Research note by White Diamond Research, page 40.", "elementsJson": [ "paragraph" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b9a-ad0811d3e80d/40", "deckHref": "/decks/019dd923-622c-750b-8b9a-ad0811d3e80d", "deckJsonHref": "/decks/019dd923-622c-750b-8b9a-ad0811d3e80d.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b9a-ad0811d3e80d#slide-40", "components": [ { "bbox": null, "kind": "callout", "text": "At the current burn rate, AXDX's cash balance will only last another six quarters.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-78b4-70ad-b3a2-f607a0b85ba1", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.78, "x": 0.11, "y": 0.53 }, "kind": "list", "text": "On 11/7/18, JPMorgan downgraded AXDX to neutral from overweight. The analyst said Q318 didn't bring what he was hoping for given \"another miss and pipeline delay\". On 8/8/19, after the Q219 earnings report BTIG analyst Sean Lavin issued a report maintaining a hold rating on AXDX. On 5/24/18, Craig-Hallum initiated AXDX with a hold rating, saying it will become attractive once expectations are significantly lowered.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "598ff83f-ceee-44a7-b54b-33db7ac14ec1", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "metric", "text": "cash burn: $21.5M", "attrs": null, "subkind": "primary", "toolName": "Quantification", "toolSlug": "quantification", "confidence": null, "componentId": "019dd953-78b4-70ad-b3a2-ff5f209e485d", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.18, "w": 0.78, "x": 0.11, "y": 0.09 }, "kind": "paragraph", "text": "AXDX lost $20.8M in Q219 and $21.5M in Q119. Clearly this level of net loss and cash burn are not sustainable for long. Right now, shareholders don't seem too concerned while the company has a considerable cash balance. AXDX reported $137.8M in cash for Q219. However, the company is also sitting on $125M in debt. That's quite a bit more than TTOO, which has $50M in debt.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "0b4530f4-4925-4e77-997a-d2e36b586243", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.78, "x": 0.11, "y": 0.28 }, "kind": "paragraph", "text": "At the current burn rate, AXDX's cash balance will only last another six quarters. AXDX has yet to earn over $2M in revenues for a quarter. We expect revenue to increase by many multiples into the next couple of quarters as hospitals are up and running with the Pheno systems placed in Q418. However, we don't expect it will be enough to significantly reduce the company's level of quarterly loss.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "a2ac1810-85ba-43f9-9808-ad9d37285ee0", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.05, "w": 0.78, "x": 0.11, "y": 0.46 }, "kind": "paragraph", "text": "After its failed Pheno system launch, most sellside analysts have given up on AXDX and just slapped a neutral or hold rating on the company.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "f2a778ff-df39-4f86-823c-c2feca83548c", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.78, "x": 0.11, "y": 0.7 }, "kind": "paragraph", "text": "Piper Jaffray is the only sell side analyst exception who still has an outperform rating on the stock. However, after Q219 results, Piper William Quirk lowered his price target to $19 from $22. Quirk estimated that 88 instruments would be placed in Q219, but it was only 55. He told investors in a research note: \"Everything except the actual results were positive in the quarter\".", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "fd338d48-47f6-456d-8e31-5158cf0d83dc", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "Everything except the actual results were positive in the quarter. — Piper William Quirk", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-78b4-70ad-b3a2-f848cefd4e9f", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.78, "x": 0.11, "y": 0.41 }, "kind": "title", "text": "Most Sell Side Analysts Have Given Up On Accelerate", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "18623769-ad60-4772-bfcc-d5b40e06f066", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [ { "name": "Storytelling: audience calibration", "slug": "audience", "agent": "storyteller", "layer": "slide", "matchId": "eebd4cdd-0b14-4954-a5ea-0faff5fdf545", "evidence": "The slide mentions 'most sell side analysts have given up on Accelerate', indicating an understanding of the audience's perspective.", "confidence": 0.7 } ], "frameworks": [], "arcBeats": [ { "to": 41, "from": 30, "beatId": "ca57db9c-677e-4ef8-919c-92b1690ee48e", "arcName": "Problem-Agitate-Solution", "arcSlug": "problem-agitate-solution", "beatName": "Solution (Provide relief)", "beatSlug": "problem-agitate-solution-solution-provide-relief", "evidence": "The document implies that the solution is to be cautious of the system's limitations and avoid investment in AXDX, citing a potential decline in AXDX shares.", "position": 2, "confidence": 0.8, "parentBeatName": "Resolution", "parentBeatSlug": "resolution" } ], "loops": [ { "to": 40, "from": 36, "name": "So What Cascade", "slug": "41-so-what-cascade", "bestFor": "Data presentations, executive summaries, driving to recommendations", "matchId": "4a0cc194-140e-4021-ac97-526c652944fe", "evidence": "The document presents a cascade of implications, including a potential CEO replacement, market guidance downgrade, and decline in AXDX shares.", "position": 2, "objective": "So what does this mean for AXDX's future?", "structure": "The Data -> So What? 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