Analysts at Wilsons have put the spotlight on one All Ordinaries Index (ASX: XAO) share it prefers over the Polynovo Ltd (ASX: PNV) share price.
Polynovo shares fell 3.23% today to $1.98. For perspective, the All Ordinaries Index climbed 0.22% today.
Let's take a look at which share the team at Wilsons recommends.
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What do analysts recommend?
Wilsons analysts believe Aroa Biosurgery Ltd (ASX: ARX) is the "best-value growth wound care on the ASX". Aroa shares soared 10% today.
Following a review of the sector, analysts highlighted they like Aroa's growth outlook and earnings base. In quotes cited by the Financial Review, analysts Dr Shane Storey and Dr Melissa Benson said:
Valuation analysis highlights that ARX's three-year revenue growth outlook is almost identical to PNV, yet it trades at multiples (EV/Revenue, EV/EBITDA) >3 times lower than PNV.
The earnings diversification of Aroa's business provides stability and growth levers that its peers (PNV, Avita Medical Inc (ASX: AVH) do not have afforded to them in the US market.
Aroa highlighted in today's half-year report it is continuing to build its USA sales team. The company has 35 direct US sales representatives.
Revenue lifted 44% on the prior corresponding period to NZ$28.8 million. The company has now upgraded its FY23 revenue guidance from NZ$51-55 million to NZ$62-64 million. The company expects its EBITDA to break even in FY23.
Meanwhile, Polynovo advised today it has received registration approval for its NovoSorb BTM product in Canada. CEO Swami Raote said:
This registration puts us well on our way to accelerating our global impact.
Aroa share price snapshot
The Polynovo share price has soared 28% in the year to date, while Aroa shares have lost 13%.
For perspective, the All Ords has shed 10% in the year to date.
Polynovo has a market capitalisation of nearly $1.3 billion, while Aroa's market cap is $303.3 million.
