Profit-taking drops Pacific Edge share price

Profit-taking and unease over Pacific Edge's plunging share price have resulted in its shares shedding more than 60% in value during the past six months.

Following a stellar run in its share price to a peak of $1.76 in early February, its shares were down 61% for the past six months, including a 25% decline during the past month.

Yesterday, shares in the Dunedin cancer diagnostic company were down more than 6%, or 4c, trading around 62c.

Craigs Investment Partners broker Peter McIntyre said while Pacific Edge's business plan and overall strategy ''remained intact'', following the strong share-price showing, investors were looking for it to start producing revenue.

However, for the three months from mid-October, Pacific Edge clinched several regulatory approvals and major international distribution deals, and its share price more than tripled by February, enticing many to take the profits offered.

''Some investors would have made money when the price was on the way up, but now that it's falling, some don't have the stomach for it, because of the volatility,'' he said.

Pacific Edge and cloud accounting company Xero, neither of which has posted a profit but have market capitalisations in the hundreds of millions, were last year's sharemarket growth-stock darlings.

 Xero shares have also plunged in recent months, down 47% from $44.79 to $23.35 yesterday.

''We've been seeing a lot of the high growth stocks sold off, as people move to more conservative shares, because of less risk,'' Mr McIntyre said.

While Pacific Edge has booked total losses of $43.88 million during the past decade, at the end of its full year to March it had $20.4 million cash in hand from capital raisings to fund its crucial expansion into the large US health market.

For its full year trading to March, Pacific Edge booked an expected $9.3 million loss, up 44% from $6.9 million the previous year.

Its revenue stream was up 187% to $523,000, including $571,000 on foreign exchange gains.

Because of the large US market for bladder cancer testing, the company maintains its gross annual revenue in five years could be $100 million.

Mr McIntyre said investors wanted ''positive signs'' that level of revenue was attainable.

Pacific Edge's non-invasive CX-bladder test costs less than $400 in New Zealand, while the cost in New Zealand and the US for repeated invasive tests runs into thousands of dollars per patient.

Earlier this month, Pacific Edge launched an e-commerce platform where New Zealanders can pay a rebated $368 for a test, send off a urine sample, and receive the results in a matter of weeks.

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