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The Ubika Research Tech Stock Watchlist
| Opsens Inc (V.OPS) |
| Company Name: |
Opsens Inc. |
| HQ Location: |
Quebec City, Quebec |
| Company Website: |
www.opsens.com |
| Shares Outstanding |
47.9 Million |
| Market Cap: |
$19.2 Million |
| 52 Week Range |
$0.34 - $1.25 |
| Closing Price (March 30, 2010) |
$0.40 |
| Average Daily Volume |
29,000 |
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The Ubika Research Tech Stock Watchlist is very useful to find interesting junior tech stocks. Quite often smallcap tech stocks and penny tech stocks offer very compelling growth and are well-suited for smallcap investment. Tech is good space to find hot Smallcap stocks and penny stock picks, and this segment provides information on such companies.
Share Highlight / 1-Year Stock Chart
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Business Overview
Opsens is a leading developer, manufacturer and supplier of a wide range of fiber optic sensors and associated signal conditioners based on proprietary patented and patent pending technologies. Opsens’ sensors provide long-term accuracy and reliability in the harshest environments. Opsens provides sensors to measure pressure, temperature, strain and displacement to original equipment manufacturers (OEM) and end-users in the oil and gas, medical, high-power transformers, and laboratory fields. Opsens provides complete technical support, including installation, training, after-sales service, for its fiber optics systems that are regulated by the ISO 9001-2008 norm. + More info
What is interesting?
- Opsens Inc manufactures fibre optic sensors which can work in extreme environments and measures temperature, pressure and strain
- Opsens sensors has application in a variety of industries: oil and gas, laboratory, medical etc are a few areas these sensors have application
- Opsens application is a patented technology that provides reliable consistent measurement.
- The key advantages include extreme environmental capability (to withstand high temp and pressure), being immune to electromagnetic interference and safety in volatile environment
- One of the major applications of these sensors is in oil sands development. 80% of oil sands development is insitu mining using Steam Assisted Gravity Drainage (SAGD). SAGD is an enhanced oil recovery technology for producing heavy crude oil and bitumen. It is an advanced form of steam stimulation in which a pair of horizontal wells are drilled into the oil reservoir, one a few metres above the other. Low pressure steam is continuously injected into the upper wellbore to heat the oil and reduce its viscosity, causing the heated oil to drain into the lower wellbore, where it is pumped out. In this process measuring temperature and pressure is critical to the efficient implementation. Opsens sensors are currently used by oil sands producers.
- Opsens sensor installation takes only a day. The company claims the production yield increases by 5% and the cost reduces by 5%, by deploying Opsens sensors.
- One of the lead customers of Opsens has been steadily increasing the purchase order with the company. This client started buying Opsens sensors for 2 wells and is now using the sensors at 26 wells. This suggests that the technology is proven. Nexen, is another customer which has 3 wells using this technology
- Company has bid on multiple oil sands contracts
- Typical Opsens sensor, costs $80,000 to $120,000. One SAGD site will have around 40 wells. Revenue potential per SAGD site is worth around $4M for the company. There is an estimated 90 insitu projects in oil sands currently. So, the market opportunity for the company is significant, if it were to be successful in increasing adoption.
- Heavy oil production is not just in Alberta, but is an opportunity globally. For example, Venezuela is a major heavy oil producer.
- Oil sands production is set to grow aggressively and Opsens could be a beneficiary
- Recently, the company is also developing products to be used in CO2 enhanced production, which is environmentally friendly
- In the medical devices industry, the company has a Japanese partnership to use Opsens sensors in a cardiac device and another partnership to use in heart pump
- During 2009, revenue was $3.1 Million and the company has a healthy backlog of orders
- The company has a recurring revenue model, as these sensors need to replaced in 18 months. So revenue stream continues after initial installation
- During the six months ending in Feb 2010, sales reached $2.1 million, almost double from the corresponding period in previous fiscal year of $1.2 million
- Company has a good cash position. Raised $3.6 million in Feb 2010
Risks
Company is still not profitable. Oil and Gas sector is dominated by large players who tend to take a long time in making decisions. Opsens product adoption in the oil and gas business where it is the furthest in its commercial quest is not a sure thing. Opsens Inc. News
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