Polynovo Limited (AU:PNV)
ASX:PNV
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Polynovo
(Sydney:PNV)
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Rating:62Neutral
Price Target:
AU$1.00
▼(-0.99% Downside)
Action:ReiteratedDate:02/20/26
The score is driven primarily by solid fundamental performance (strong growth, very high gross margins, and a healthy balance sheet) and a constructive earnings update with improving cash flow and clear milestones. This is tempered by weak technical trend signals and an expensive valuation (high P/E, no yield), which increase sensitivity to execution and cash flow follow-through.
Positive Factors
High gross margins and improving profitability
Very high gross margins (95.9%) alongside revenue growth and improved ROE signal durable product-level economics and pricing power. This margin profile supports reinvestment in clinical evidence, commercialization and scale without heavy gross-margin erosion as volumes expand.
Negative Factors
Weak free cash flow conversion
Significant negative FCF growth and low operating cashflow conversion limit self‑funding capacity for capex, trials and commercial rollouts. Until conversion improves, growth may require careful cash management or external funding, increasing execution risk during scale-up.
Read all positive and negative factors
Positive Factors
Negative Factors
High gross margins and improving profitability
Very high gross margins (95.9%) alongside revenue growth and improved ROE signal durable product-level economics and pricing power. This margin profile supports reinvestment in clinical evidence, commercialization and scale without heavy gross-margin erosion as volumes expand.
Read all positive factors
Polynovo (PNV) vs. iShares MSCI Australia ETF (EWA)
Market Cap
AU$690.84M
Dividend YieldN/A
Average Volume (3M)1.48M
Price to Earnings (P/E)70799.0
Beta (1Y)1.77
Revenue Growth19.36%
EPS Growth66.28%
CountryAU
Employees282
SectorHealthcare
Sector Strength45
IndustryMedical - Devices
Share Statistics
EPS (TTM)0.00
Shares Outstanding690,843,000
10 Day Avg. Volume1,478,953
30 Day Avg. Volume1,476,427
Financial Highlights & Ratios
PEG Ratio0.41
Price to Book (P/B)9.95
Price to Sales (P/S)6.51
P/FCF Ratio-76.87
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
AU$1.74Price Target Upside72.28% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)<0.01
Revenue Forecast (FY)AU$150.68M
Polynovo Business Overview & Revenue Model
Company Description
PolyNovo Limited develops medical devices in the United States, Australia, New Zealand, the United Kingdom, Ireland, Singapore, and internationally. The company offers NovoSorb Biodegradable Temporising Matrix, which is used in a fully debrided cl...
How the Company Makes Money
Polynovo makes money primarily by selling its NovoSorb-based medical products to healthcare providers (e.g., hospitals, burn centers, surgical units) for use in procedures and wound management. Revenue is generated from product sales (consumable, ...
Polynovo Earnings Call Summary
Earnings Call Date:Feb 20, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Aug 21, 2026
Earnings Call Sentiment Positive
The call presents a predominantly positive operational and commercial picture: double‑digit revenue growth across major regions (group +26%, U.S. +25.3%, RoW +28.3%), rapid MTX adoption (~+193%), improved cash flow (+$9.0M) and a strong clinical evidence base (348 studies). Key strategic catalysts (PMA submission, SynPath outpatient pathway, expanded manufacturing capacity, recruitment of a Chief Scientific Officer) provide clear upside. Short‑term headwinds include a timing‑related manufacturing variance (~$3.6–3.7M) from planned slowdowns, an R&D lab fire asset write‑off (insured), FX translation losses, and reimbursement/regulatory uncertainty for outpatient CMS coverage which may require an RCT. Management frames several negatives as one‑offs or timing issues and expects margin and free cash flow improvement in H2. Overall, highlights materially outweigh the lowlights.Positive Updates
Strong Group Revenue Growth
Group NovoSorb product sales were $68.2 million, up 26% year‑on‑year (+$14.1 million), indicating solid momentum into the second half.
Negative Updates
Temporary Manufacturing Output Reduction and Unfavorable Variance
Management intentionally slowed manufacturing to complete validation and preparation for PMA/FDA audit, producing an unfavorable manufacturing variance of ~$3.6–3.7 million for the half and reducing production recovery. Half‑year gross margin was 88.8% as a result (management expects >90% for full year once output ramps).
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Group Revenue Growth
Group NovoSorb product sales were $68.2 million, up 26% year‑on‑year (+$14.1 million), indicating solid momentum into the second half.
Read all positive updates
Company Guidance
Management provided no formal earnings guidance but gave clear directional guidance and milestones: group NovoSorb sales were $68.2m (+26% YoY, +$14.1m), driven by the U.S. at $51.7m (+25.3%) and Rest of World $16.5m (+28.3%); MTX sales were $6.0m (+193%) and now in >240 U.S. accounts, total customer accounts exceed 800 after adding 95 new hospital accounts, and the U.S. commercial team is >80 reps. Key financials/targets include adjusted EBITDA $4.7m (+82%), H1 gross margin 88.8% with management expecting >90% for FY‑26 after a $3.7m one‑off manufacturing variance, cash on hand $29.2m, operating cash flow $9m (vs prior period -$12.5m), debtors days improved to 56 (from >90), CapEx paid $10.8m with $2.2m remaining, and the new Port Melbourne facility (~5x prior capacity) being qualified for production (firing up from July). Clinical and market milestones: PMA submission for on‑label full‑thickness burns on track for FY‑end (BARDA partnered), 348 peer‑reviewed studies (65 relevant to outpatient, 5 in diabetic limb salvage) with RCT data due in 6–12 months and a planned RCT for CMS reimbursement, SynPath outpatient pathway leveraging an existing HCPCS code (monolayer code expected later this year) with new outpatient sizes available this half, and planned hires (Market Access Director, Senior Product Manager, CSO) to accelerate outpatient and international expansion; management reiterated outpatient contribution is upside and, given burn variability, they will not provide formal near‑term guidance.Polynovo Financial Statement Overview
Summary
Income Statement
75
Positive
Balance Sheet
70
Positive
Cash Flow
60
Neutral
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 137.93M | 127.24M | 103.19M | 65.24M | 41.44M | 29.16M |
| Gross Profit | 44.57M | 122.05M | 97.71M | 19.33M | 16.23M | 7.83M |
| EBITDA | 7.12M | 10.45M | 4.59M | -2.71M | 658.24K | -3.41M |
| Net Income | 9.88M | 13.21M | 5.26M | -4.92M | -1.19M | -4.61M |
Balance Sheet | ||||||
| Total Assets | 123.37M | 127.41M | 108.72M | 92.62M | 34.97M | 38.34M |
| Cash, Cash Equivalents and Short-Term Investments | 29.26M | 33.59M | 45.96M | 46.90M | 6.15M | 7.74M |
| Total Debt | 31.74M | 17.14M | 15.38M | 16.04M | 10.99M | 10.00M |
| Total Liabilities | 40.23M | 44.15M | 36.60M | 27.24M | 17.26M | 15.99M |
| Stockholders Equity | 83.14M | 83.26M | 72.12M | 65.38M | 17.72M | 22.35M |
Cash Flow | ||||||
| Free Cash Flow | 5.37M | -10.78M | 786.00K | -7.46M | -2.55M | -3.82M |
| Operating Cash Flow | 24.95M | 3.15M | 3.68M | -5.93M | -2.06M | -248.74K |
| Investing Cash Flow | -19.58M | -13.22M | -1.49M | -1.53M | 5.86M | -3.57M |
| Financing Cash Flow | -1.98M | -2.39M | -3.17M | 48.06M | -5.39M | -70.37K |
Polynovo Technical Analysis
Positive
1.01
Price Trends
0.94
Positive
1.06
Negative
1.18
Negative
Market Momentum
0.02
Negative
56.37
Neutral
59.33
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:PNV, the sentiment is Positive. The current price of 1.01 is above the 20-day moving average (MA) of 0.95, above the 50-day MA of 0.94, and below the 200-day MA of 1.18, indicating a neutral trend. The MACD of 0.02 indicates Negative momentum. The RSI at 56.37 is Neutral, neither overbought nor oversold. The STOCH value of 59.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:PNV.
Polynovo Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | AU$6.23B | 26.40 | 17.76% | 1.64% | 2.04% | -6.63% | |
62 Neutral | AU$690.84M | 70,799.02 | 11.87% | ― | 19.36% | 66.28% | |
56 Neutral | AU$186.79M | -47.06 | -2.00% | ― | 16.92% | 76.47% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
45 Neutral | AU$38.45M | -2.79 | -40.41% | ― | 26.59% | 33.42% | |
44 Neutral | AU$2.86B | -4.94 | -152.49% | ― | ― | 5.28% | |
41 Neutral | AU$42.29M | -2.66 | -180.06% | ― | 74.74% | 4.32% |
* Healthcare Sector Average
AU:PNV
Polynovo
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-18.60%
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Polynovo Corporate Events
PolyNovo names CSL veteran Marthe D’Ombrain as Chief Scientific Officer to drive next-phase growth
Apr 21, 2026
PolyNovo has appointed Dr Marthe D’Ombrain as Chief Scientific Officer, effective 1 June 2026, strengthening its leadership team as it advances its NovoSorb technology platform for complex wound care. Dr D’Ombrain brings more than two ...
PolyNovo Appoints New Director With No Current Securities Interests
Apr 1, 2026
PolyNovo Limited has announced the appointment of Charmaine Hilary Gittleson as a director, effective 1 April 2026, in an initial director’s interest notice lodged with the ASX. The filing confirms that Gittleson currently holds no relevant ...
PolyNovo strengthens board with appointment of Dr Charmaine Gittleson
Mar 24, 2026
PolyNovo has appointed former CSL chief medical officer Dr Charmaine Gittleson as an independent non-executive director, effective 1 April 2026. Her extensive experience in global healthcare, clinical development, regulatory strategy and governanc...
PolyNovo Director Robert Douglas Acquires Initial Stake of 151,000 Shares
Mar 16, 2026
PolyNovo Limited has disclosed a change in director Robert Douglas’s interests, with Douglas acquiring 151,000 fully paid ordinary shares in the company through an on-market trade executed via a Schwab brokerage account for the benefit of th...
PolyNovo Director Andrew Lumsden Doubles Indirect Shareholding
Feb 27, 2026
PolyNovo has disclosed a change in director Andrew Lumsden’s indirect shareholding, with his interest held via the Lumsden Family Trust increasing through an on-market purchase. The transaction involved acquiring 100,000 fully paid ordinary ...
PolyNovo Director Leon Hoare Increases Indirect Shareholding via On-Market Purchase
Feb 27, 2026
PolyNovo Limited has reported a change in the indirect shareholding of director Leon Hoare, as disclosed to the ASX. Hoare, through his BT Super personal superannuation account, increased his beneficial holding in PolyNovo by acquiring 30,000 full...
PolyNovo Posts H1 FY26 Investor Call Recording as NovoSorb Platform Supports Global Growth
Feb 25, 2026
PolyNovo Limited, an Australia-headquartered medical technology company, specialises in advanced wound care solutions based on its proprietary NovoSorb biodegradable polymer platform. Its key products, NovoSorb BTM and NovoSorb MTX, are used in de...
PolyNovo Sets Webcast to Present H1 FY26 Results
Feb 20, 2026
PolyNovo has released an announcement regarding its H1 FY26 financial results, indicating that a detailed presentation will be provided via a scheduled webcast. The event will feature updates from the chair, CEO and CFO, including financial perfor...
PolyNovo lifts half-year sales and capacity as new CEO targets next growth phase
Feb 20, 2026
PolyNovo reported half-year FY26 group sales of A$68.2 million, up 26% year-on-year, with U.S. revenue rising 25.3% and NovoSorb MTX sales nearly tripling, while total revenue including BARDA reached A$75 million. Despite flat net profit, adjusted...
PolyNovo Expands Balkan Reach With New NovoSorb Distributor
Feb 1, 2026
PolyNovo has appointed Arbor Vitae International LLC as its distributor for eight Balkan countries, extending its European commercial reach to an additional 22 million people through a cost-effective distribution model. The partnership, which capi...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.