ZOM Stock: Zomedica Continues Flying

Zomedica Corp (NYSEAMERICAN: ZOM) is having a great start to the trading session this morning, following up on the strong gains seen out of the stock yesterday. The gains started when the company announced the appointment of Robert Cohen as its CEO. Here’s what’s happening:

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Zomedica Appoints Robert Cohen as CEO

In a press release issued yesterday, Zomedica announced that it appointed Robert Cohen as its CEO, effective on the first of January. Prior to being appointed as CEO, Cohen held a position as the company’s Interim CEO and a member of the Board of Directors. 

Mr. Cohen has a long history of leadership in the medical device, biotechnology and pharmaceutical industries. In fact, he has held executive leadership positions in the space for more than 30 years. 

ZOM explained that following his earlier tenure at three multi-billion dollar medical tech companies, Mr. Cohen began building shareholder value for smaller organizations as CEO. Due to his strong track record of building early-stage companies and developing medical devices and biotechnology products, now is the perfect time for him to take control as CEO with the launch of TRUFORMA just around the corner. 

Management Commentary

In a statement, Mr. Jeffrey Rowe, Chairman of the Board at ZOM, had the following to offer:

Over the past six months we have enjoyed collaborating with Rob and have been thoroughly impressed with his business acumen and the professional leadership skills he has brought to Zomedica at such a crucial time. The Board is excited that Rob has agreed to accept the CEO position as we near our most pivotal milestone. Rob’s successful track record in launching medical devices is perfectly aligned for Zomedica’s needs as we complete the development of our TRUFORMA™ platform and achieve its commercial launch. The Board and our employees remain excited about the near-term launch, our commercialization strategy, and Zomedica’s longer-term growth opportunity.

The above statement was followed up by Mr. Cohen. Here’s what he had to say:

I am honored to move into the CEO role at this most pivotal time. Since I initially joined the Company this past June, I have had time to appreciate the strong capabilities of not only our Board of Directors, but also the entire Zomedica team, and I proudly can say that I believe that we are strongly positioned to capitalize on our commercial launch. The industry dynamics are extremely exciting, and we believe that the large addressable diagnostic market opportunity lends itself perfectly to our TRUFORMA™ point-of-care diagnostic platform.

Preparing for the Launch of TRUFORMA

Zomedica has been a hot topic as of late and for good reason. Not too long ago, investors received an update surrounding the launch of TRUFORMA. The company expects the launch to take place early this year. 

In order for a smooth and successful launch, the company needs a leader that knows how to bring a new medical technology product to market. That’s exactly what Cohen has a strong history of doing. So, the appointment of Robert Cohen couldn’t have happened at a better time. 

Keep in mind, with the launch of the TRUFORMA veterinary diagnostics platform, the company will be entering a market that’s worth billions of dollars per year with a product that’s unmatched in the industry. 

What Analysts Think About ZOM Stock

According to TipRanks, there is only currently one analyst that’s weighing in on ZOM stock. However, that analyst has a positive opinion, with a Buy rating. 

The price target on the stock is $0.30, which represents a downside, but it’s important to keep in mind that coverage is relatively old and the $0.30 price target doesn’t likely take the coming launch of TRUFORMA into account. 

Risks to Consider Before Buying ZOM Stock

If you’re going to make an investment, you’re going to accept risk, it’s just part of the process. When it comes to ZOM stock, the most significant risks to consider are as follows:

  • An Unproven Business Model. Zomedica isn’t generating any profit and is in the very early stages of business. While the launch of TRUFORMA may quickly change that, the fact of the matter is that the company’s business model has not yet been proven. 
  • Commercial Risks. ZOM will launch TRUFORMA soon. However, that doesn’t mean much if nobody buys the product. What seem to be great products fail in the market all the time. As such, without a proven history of TRUFORMA sales, Zomedica comes with commercial risks that should be considered. 
  • Capital Risks. Finally, because of the fact that ZOM isn’t generating any profits, it must rely on the cash it has in the bank to survive. If that cash isn’t enough, the company may tap capital markets for funding, leading to the dilution of existing shareholder value. 

Final Thoughts

It’s always important to consider the risks, but the section above wasn’t designed to scare you off. The fact of the matter is that Zomedica is young, but it seems to be on the right path. Moreover, with TRUFORMA launching soon, there has never been a more exciting time to get involved in the stock. All in all, this is an opportunity that’s hard to ignore.