IQ-AI Ltd. reported financial results for the first six months of 2022, confirming 7.2% year-over-year growth at the topline at the Company’s principal portfolio investment in Imaging Biometrics. Investors might have liked a higher number than GB£ 255,609 in the six-month period, but the slightly faster growth rate than the radiology solutions sector suggests Imaging Biometrics is achieving good market penetration. Operations used GB£ 339,782 in cash to support operations in the six-month period, leaving GB£ 354,732 in the bank at the end of June 2022.
New product development suggests the Company will have even more to offer customers in the radiology departments of hospital and clinic settings. At least two new applications, IB Trax and IB Rad Tech Automation, could be ready for commercial sales within the next few months.
Notably, Imaging Biometrics leadership has crafted an alternative economic option for customers that are not candidates for the Company’s current subscription or licensing models. An inaugural customer in radiology services is currently reviewing a pilot contract that will let the customer access IB Clinic and other modules on an ala carte basis with the Company providing processing services. If successful the software-as-a-service model could increase the Company’s addressable market and create a new revenue stream.
We continue to view IQAI as overlooked at a time when artificial intelligence is gaining prominence in the healthcare field. Imaging Biometrics appears to moving to the forefront of artificial intelligence technology for healthcare and, in our view, is shaping up as a leader among radiology solutions. We point to the Company’s IB Zero G technology. If approved IB Trax would be the first of its kind, setting the product line apart from other medical imaging solution sets.
We reiterate our Speculative Buy rating and maintain our price target at 6.50 GBp for shares listed on the London Stock Exchange. Our price target represents 180% growth potential from the current price level. We note that our price target represents intrinsic value based only on current products, providing investors a free option on the product development pipeline.
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