Foresight Autonomous Holdings Ltd (TA:FRST) shares have performed very strongly over the last month. Key influences have been the high valuation implied by the Intel (NASDAQ:INTC) acquisition of Mobileye (NYSE:MBLY), the successful completion of a round of equity fund-raising ahead of the group’s planned NASDAQ listing and positive feedback from Deutsche Bahn’s testing of Rail Vision’s safety systems.
Positively, the Q117 equity issues of NIS42.7m ($11.7m) put the company on track for self-financing and we have also increased our earnings forecasts to reflect what we see as Rail Vision’s improved near-term order prospects, boosting our DCF valuation from NIS3.11 to NIS3.30 per share.
Recent share issues put FRST on self-financing track
Following recent share issues, raising a gross NIS42.7m ($11.7m) in Q117, our forecasts indicate that FRST will need only NIS4.5m ($1.1m) in further funding before becoming free cash flow generative in 2020. Cash from warrants conversions are likely to fill this gap given the potential NIS113.9m ($31.0m) from the conversion of currently in-the-money warrants.
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