New Zealand Coastal Seafoods Limited (ASX: NZS)

NZS produces nutraceuticals, seafood products, and marine ingredients in New Zealand, Australia, and Asia. It also offers ready to eat products, such as cooked ling maw, cooked paua, and powdered collagen ling maw nutraceutical products under the NZCS brand including online offerings. The company was incorporated in 2007 and is based in Nedlands, Australia. The current market capitalization is $9.92 million, and a current price of $0.012 per share.

Financial & Operational Highlights – On 25^th August 2021, the company announced that it has received Marine Stewardship Council (MSC) certification and now it can apply the MSC ecolabel on certified products after getting approval. This brings the company only among two players in New Zealand who is producing MSC Certified dried ling maw and among very few players in the world who can produce MSC Certified hydrolysed marine collagen powder.

On 30^th July 2021, the company shared its quarterly activity report for the quarter ended 30^th June 2021, stating the tremendous growth in cash receipts from its customers that increased by 220% to AU$731.47k as compared to the March 2021 quarter of AU$227.48k. However, the cash and cash equivalent declined to $2.75 million for the quarter ended 30^th June 2021 as compared to the $3.23 million as on 31^st March 2021. On the operational front, the group stated a significant progress on the development and the commercialization of its flagship marine collagen product, with the finalization of the Toll Processing Agreement used for extraction.

Technical Analysis- The stock gave a breakout in July 2020 around $0.010, running vertically and touched the high of $0.084, only to be sold off in the next few trading sessions. Since then, the stock is in a downtrend with lower lows and lower highs and now entering into a low volatile trading zone. The relative strength index is at 45.553 which is in the middle zone, an indication of not a linear movement in the prices from current levels. The 21 days simple moving average is placed very closely with the stock price at $0.013 hence lacking any trend biasness or trend continuation from the given level. For the prices to find stable grounds, the support of $0.009 should be well respected and held firmly, since the prices are declining and heading towards the multi-year lows and a breach of this level, could further bring pain to the stock price. The stock prices tanked lately and might see profit booking; hence the resistance can be plotted at lower levels of $0.016.

Though the cash receipts from customers have improved, but the cash balances have declined, and the continuous sell-off across the stock prices pulled the investor's confidence lower. Considering the above factors into considerations, we give the stock the rating of ‘Avoid’ at the closing price of $0.012, as of 31^st August 2021.

Daily Technical Chart – NZS

Source: REFINITIV

Silex Systems Limited - (ASX: SLX)

SLX is engaged in providing research, development, commercialization, and licenses of SILEX laser uranium enrichment technology in Australia. The company also develops cREO technology for the integration of various compound semiconductor devices with silicon wafer-based production techniques. The company was incorporated in 1988 and is based in Sydney. The current market capitalization is $182.26 million, and a current price of $1.250 per share.

Financial & Operational Highlights – As per the announcement shared on 30^th August 2021, the company’s prototype demonstration facility commenced operations and early testing for the production of Zero-Spin Silicon is currently underway using the SILEX laser isotope separation process.

The recent release of the financial year-end results for the period ended 30^th June 2021, stated the tremendous growth in revenue from ordinary activities by 106.5% to $2.07 million for the FY21 as compared to the $1.00 million in FY20. The net losses declined by 11.2% to $6.93 million in FY21 as compared to $7.81 million in FY20. The cash and cash equivalents declined by 23.45% to $14.10 million for FY 21 compared with FY20 balances of $18.42 million.

Technical Analysis- The stock showed a strong uptrend in mid-2020 till it printed the highs of $1.70 and eventually corrected from these levels forming lower highs and lower lows. The relative strength index is at 78.077, which is crawling towards an overbought level, indicating some more upside remaining from the current levels and the stock could be prone to severe correction at a later stage. The 21 days simple moving average is hovering below the stock price at $0.963, which implies the uptrend continuation from current levels. Since the prices recently spiked because of the financial updates, hence the support is placed at $0.875 and resistance at $1.38. Breaking either side of the range will give a clear picture of the trend formation.

With improved revenues, strong cash balance, lack of previous financial results and minimal stock price data to gauge the technical analysis trend, we give the stock the rating of ‘Avoid’ at the closing price of $1.25, up by ~18.483% as of 31^st August 2021.

Daily Technical Chart – SLX

Source: REFINITIV

Sensera Limited (ASX: SE1)

SE1 operates as an Internet of Things (IoT) solution provider that delivers sensor-based products transforming real-time data into meaningful information, action, and value in the United States and Germany. The company operates in two segments, Microdevices and IoT Solutions. The company was incorporated in 2016 and is based in Melbourne, Australia, with a current market capitalization is $13.24 million, and a current price of $0.031 per share.

Financial & Operational Update – On 2^nd August 2021, the company announced its successfully raised $2.5 million through private placement to the professional and sophisticated investor, utilising the funds for business development, working capital and placement costs. On 26^th July 2021, the company released its quarterly revenues for the period ending on 30^th June 2021, stating the increase in revenues to US $633k from US $451k in March 2021.  Another key aspect was the record increase in the cash receipts to US $807k in June 2021 from US $383k in March 2021. There was a slight decline in the cash and cash equivalents to US $787k for the quarter ending June 2021 from the balance of US $832k on 31^st March 2021. On the profitability front, the company narrowed its losses by 46% to US $4.47 million in FY21 as compared to the losses for FY20.

Technical Analysis: The stock emerged from the lifetime lows of $0.002 and picked up forming higher highs and higher lows printing the highs of $0.13 levels and sold off eventually and declining since then. The relative strength index is at 36.034, which is heading towards an oversold zone, implying more correction from current levels. The 21 days simple moving average is hovering close to the stock price and placed above at $0.033, giving some more bearish signal to the stock price. The stock price is crawling towards the multi-year lows; hence the support levels are placed lower at $0.023. For the prices to further resume the uptrend, the resistance of $0.039 needs to be taken off with strong volumes.

Increasing revenues and cash receipts from customers, narrowing down of losses are showing the sign of turnround, but the same is not visible in stock price which is showing declining trend. Hence, we give an ‘Avoid’ rating to the stock at the closing price of $0.031, down by ~3.126%, as of 31^st August 2021.

Daily Technical Chart – SE1

Source: REFINITIV

4DS Memory Limited (ASX: 4DS)

4DS is engaged in the research and development of non-volatile memory technology. It develops interface switching ReRAM products for storage-class memory. 4DS Memory Limited has a collaboration with the imec. The company was incorporated in 2007 and is based in West Perth, Australia. The market capitalization stood at $198.14 million at $0.145 per share.

Financial & Operational Updates – As per the exchange update on 17^th August 2021, the company stated that its 4DS’ Interface Switching ReRAM technology is fully compatible with state-of-the-art high volume DRAM and NAND production process. Further, it stated that the best-recorded speed at near DRAM read speed exceeds Storage Class Memory requirements without giving the errors correction during speed crippling.  Off late the company announced its financial year results ending on June 2021, stating the increase in revenues for the FY21 by 23% to $41k from $33k in FY20. The company also witnessed an increase in its net loss for FY21 by 22% to $6.63 million in FY21 from $5.43 million in FY20. Further, analysis it at micro levels, the company did not receive any cash receipts from its customers for the straight 12 months ending on 30^th June 2021. The cash balances declined to $4.3 million in June 2021 as compared on quarter-on-quarter basis from $5.5 million on March 2021.

Technical Analysis- The stock showed a gradual downtrend with few spikes, which eventually sold off and entered the low volatile trading zone until the recent volatility touched the high of $0.245. The relative strength index is at 38.862, which is crawling towards an oversold level, indicating some more downside remaining from the current levels and the stock could be prone to severe pullback, lasting short term, the closer it reaches overbought territory. The 21 days simple moving average is hovering above the stock price at $0.1829, which implies the bearish trend continuation from current levels. Since the prices are in a low volatile, hence the support is placed at $0.12 and resistance at $0.20. Breaking either side of the range will give a clear picture of the trend formation. 

Due to missing cash receipts from its customers, accompanied by accumulating losses and declining stock prices, the stock entered the low volatile zone, which is prone to a sudden breakout, hence we give the stock the rating of ‘Avoid’ at the closing price of $0.145, down by ~3.334%, as of 31^st August 2021.

Daily Technical Chart – 4DS

Source: REFINITIV

Note 1: The reference data in this report has been partly sourced from REFINITIV.

Note 2: Investment decisions should be made depending on the investors’ appetite for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and the uptrend may take a pause due to profit booking or selling interest. 

The Green colour line reflects the 21-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 21-period, then it shows prices are currently trading in a bullish trend, (Vice – Versa).

The Purple colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

Disclaimer - This report has been issued by Kalkine Pty Limited (ABN 34 154 808 312) (Australian financial services licence number 425376) (“Kalkine”) and prepared by Kalkine and its related bodies corporate authorised to provide general financial product advice. Kalkine.com.au and associated pages are published by Kalkine.

Any advice provided in this report is general advice only and does not take into account your objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your objectives, financial situation and needs before acting upon it.

There may be a Product Disclosure Statement, Information Statement or other offer document for the securities or other financial products referred to in Kalkine reports. You should obtain a copy of the relevant Product Disclosure Statement, Information Statement or offer document and consider the statement or document before making any decision about whether to acquire the security or product.

You should also seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice in this report or on the Kalkine website. Not all investments are appropriate for all people.

The information in this report and on the Kalkine website has been prepared from a wide variety of sources, which Kalkine, to the best of its knowledge and belief, considers accurate. Kalkine has made every effort to ensure the reliability of information contained in its reports, newsletters and websites. All information represents our views at the date of publication and may change without notice.

Kalkine does not guarantee the performance of, or returns on, any investment. To the extent permitted by law, Kalkine excludes all liability for any loss or damage arising from the use of this report, the Kalkine website and any information published on the Kalkine website (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine hereby limits its liability, to the extent permitted by law, to the resupply of services.

Please also read our Terms & Conditions and Financial Services Guide for further information.

On the date of publishing this report (referred to on the Kalkine website), employees and/or associates of Kalkine and its related entities do not hold interests in any of the securities or other financial products covered on the Kalkine website.

Kalkine Media Pty Ltd, an affiliate of Kalkine Pty Ltd, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.