Edison Issues ADR Update on Thin Film Electronics

Feb 22, 2016, 12:52 ET from Edison Investment Research

LONDON, February 22, 2016 /PRNewswire/ --

Thinfilm has secured $42m in new funding from Woodford, which has agreed to acquire 17.8% of the shares. The company has also announced two NFC OpenSense deals: an exclusive partnership to deliver the technology to clients of Arc, a shopper marketing agency within Leo Burnett, and a collaboration with Constantia Flexibles, a leading manufacturer of flexible packaging and labels. These deals further underpin our expectation of substantially increased order volumes for NFC OpenSense from H216, not only in security-conscious areas such as pharma and beverages, but also across the broader consumer spectrum. If realized, we see considerable upside potential for the earnings outlook and valuation, especially now that financing is assured for the year ahead.

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If Thinfilm can establish itself in the wider consumer products markets, we see significant potential to increase our sales forecasts from 2017 and to increase our DCF valuation, currently $7.77 per ADR ($7.00 after adjusting for the planned equity issue). Investor confidence should be increased by the funding security provided by the new equity issue and the presence of Woodford on the share register.

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SOURCE Edison Investment Research