NEW YORK, NY / ACCESSWIRE / November 28, 2017 / SeeThruEquity, a leading independent equity research and corporate access firm focused on small-cap and micro-cap public companies, today announced it has issued an update on Zynex, Inc. (OTCQB: ZYXI).
The report is available here: ZYXI November Update Note.
Based in Lone Tree, CO, Zynex, Inc. (OTCQB: ZYNX, "Zynex") produces medical devices that utilize electrotherapy to treat pain and rehabilitation. The company's flagship product, NexWave™, is an FDA-cleared electrotherapy medical device that offers non-invasive, non-addictive treatment of chronic and acute pain. With a growing active installed base of over 50,000 devices, NexWave™ provides Zynex with a high margin revenue stream with recurring attributes from supplies and consumables. Beyond NexWave™, Zynex offers additional solutions for pain management, neuro-monitoring and stroke recovery. Zynex is in the process of completing an impressive turnaround, and appears well-positioned for growth. Upcoming catalysts include continued execution in NexWave™ and possible regulatory clearance for the CM1500, a new class 2 device targeting the large unmet need for post-surgery blood volume monitoring. Zynex has also announced its intention to uplist shares to a national exchange - likely the NYSE American or Nasdaq CM - which has the potential to raise its visibility in its industry as well as among institutional investors restricted from investing in OTC companies.
Highlights of the report include:
On November 13, 2017, Zynex reported impressive FY3Q17 results, with highlights as follows:
- Revenues grew by 88% YOY in FY3Q17 to reach $6.8mn and stand at $15.3mn in the first nine months of 2017
- Management guided to 2017 full year revenues to be $22.3mn- $22.8mn, above our prior estimate of $19.2mn
- Zynex expects Adjusted EBITDA to grow sequentially and be $8.6mn- $9.1mn for the full year 2017.
- Zynex reported fully diluted EPS of $0.07 during the quarter and $0.12 for the first nine months of 2017.
Outstanding results in 3Q17 as revenue and profits grow
Zynex reports robust growth in revenue and profitability in 3Q17. The company grew revenues by 88% YoY and 35% sequentially on strong sales of product supplies. For the first nine months of 2017, revenues came in at $15.3mn, representing 47.2% growth over $10.4mn in the prior year comparable period. Benefitting from strong 80% gross margins and earnings leverage, Zynex generated Adjusted EBITDA of $3.1mn in 3Q17, with GAAP Net Income growing by 300%+ YoY to reach $2.2mn, or $0.07 per share. Operating cash flow was also strong and stands at $4.7mn for the first nine months of the year.
Strong guidance suggests more to come
We were pleased to see Zynex issue guidance for further growth in 4Q17. Management now anticipates revenue to grow sequentially to a range of $7.0-$7.5mn, with adjusted EBITDA also expanding to a range of $3.0 - $3.5mn. The guidance estimates full year revenues above our view, with revenue expected to reach $22.3mn - $22.8mn, versus our prior estimate of $19.2mn, and well ahead of 2016 revenues of $13.3mn. For the full year Zynex expects Adjusted EBITDA, which excludes share compensation, to be in a range of $8.6mn - $9.1mn, versus $1.3mn in 2016.
Raising Price target to $5.00
We are raising our price target for Zynex to $5.00 following strong 3Q17 results, which were marked by robust growth in revenue and earnings. The target suggests a fair value of 25x 2017E EPS of $0.20, and potential upside of 66.7% from the recent close of $3.00. In our view, 3Q17 cements the turnaround at Zynex, and we now look for growth as the company executes its sales strategy.
Please review important disclosures on our website at www.seethruequity.com.
About Zynex, Inc.
Zynex, founded in 1996, markets and sells its own design of electrotherapy medical devices used for pain management and rehabilitation; and the company's proprietary NeuroMove device designed to help recovery of stroke and spinal cord injury patients. Zynex is also developing a new blood volume monitor for use in hospitals and surgery centers. www.Zynex.com.
About SeeThruEquity
Since its founding in 2011, SeeThruEquity has been committed to its core mission: providing impactful, high quality research on underfollowed smallcap and microcap equities. SeeThruEquity has pioneered an innovative business model for equity research that is not paid for and is unbiased. SeeThruEquity is the host of acclaimed investor conferences that are the ultimate event for publicly traded companies with market capitalizations less than $1 billion.
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SOURCE: SeeThruEquity