FTSE firms rattled by surprise stock drop: Change without warning
Technology: In the world of investing, unexpected changes can occur without warning, leaving even experienced investors surprised. This is exactly what has happened with hVIVO, a little-known company listed on the FTSE AIM 100 index. Over the past 10 days, hVIVO shares have fallen by 26%, now trading at just 22p. Despite this dramatic drop, the only notable development has been Octopus Investments, the company’s largest shareholder, increasing its stake to 13.32%.
What’s behind the drop? hVIVO specializes in conducting human challenge trials for biopharmaceutical companies, accelerating data collection and reducing clinical trial costs. Although exact numbers are scarce, it has been estimated that a large portion of their revenue comes from vaccine candidate testing. However, a recent political move in the United States could cloud future prospects.
The Robert F. Kennedy Center, a vaccine skeptic, has been criticised by former President Donald Trump for allegedly threatening to take over the company’s portfolio. The appointment of Kennedy Jr. to a high-profile health position is a concern. Kennedy’s potential influence on vaccine policy could challenge hVIVO’s core business, possibly affecting the continuation of vaccine research and development funding from federal bodies, a key revenue source for pharma companies.
Recent Performance and Future Outlook
Despite the current uncertainties, hVIVO announced a record £35.6 million in H1 revenue, representing a 30.6% increase year-on-year. With medium-term revenue ambitions of £100 million by 2028, the company shows strong growth potential. Nevertheless, the immediate future for investors remains uncertain.
Investor Views
In a risk-laden landscape, some investors, including myself, remain cautiously optimistic, viewing this dip as a buying opportunity. However, as the market remains volatile, the possibility of further declines cannot be ruled out.
