One Canadian stock I don’t cover enough, but one which I think is certainly worth diving into right now, is Therma Bright (TSXV:THRM).
The Canadian life sciences company focuses on providing the market with innovative medical device solutions. From diagnostics to a range of therapeutic technology solutions, Therma Bright is a unique company in what many view as a defensive and long-term investment sector.
Let’s dive into the company’s financials and future outlook to see if this is a stock worth buying, holding, or selling right now.
What do the financials say?
This past fiscal year, Therma Bright has done a good job of narrowing its past losses, with its total FY 2024 net loss coming in below $0.01 per share. That’s down from a $0.016 loss during 2023 and signals this is a company that’s moving in the right direction.
Now, Therma Bright is what I’d consider a micro cap stock, given the fact the company only generated around $26,000 in revenue during 2024. This year, investors will certainly want to see much more in the way of revenue growth, given the fact this company is valued at a total market capitalization of less than $5 million.
Volatility within the company’s core business has led to lumpiness across various quarterly earnings reports. Trailing 12-month revenue is down considerably, though there have been some positive indications this revenue growth could pick up in the quarters to come. That said, until we see material changes on this front, I think the market is correct to assume this is a higher-risk stock that should be held within a portfolio of similarly sized companies.
Where to go from here?
In my view, based on Therma Bright’s sheer size, stock investors will most likely be best served by either holding a very small percentage of one’s investable capital in this particular name or looking for other better opportunities in the market.
Therma Bright’s core commercial ramp-up of many of its core products remains a key sticking point for me, as well as many other investors. Additionally, the low volatility nature of these shares and a lack of liquidity in Therma Bright stock makes this one a bit too risky for my liking.
That’s not to say Therma Bright isn’t for everyone, just that there are clear risks embedded in owning this name.