Stereotaxis, Inc. (NYSE:STXS)

Friday, May 24, 2019

Research

STEREOTAXIS INC (OOTC:STXS) ($2.41; $142.9M market cap), a company that designs, manufactures, and markets robotic systems and instruments for the treatment of abnormal heart rhythms in the United States and internationally, saw its shares hit new 52 week highs on the heels of a bullish Seeking Alpha article title, “Stereotaxis: Well Positioned To Become 'Intuitive Surgical Of Endovascular Surgery' With Genesis Launch And Proprietary Catheter Development”.  Below are the bullet summaries from the article:

  • Unveiling of Innovation Plan at HRS details path to over $60 million in annual sales, or double current levels, from existing customer base alone.
  • Company’s ~110 active systems worldwide and ~$25-28 million in recurring revenue since FY2011, including record levels in FY2018, provide solid foundation to build off of.
  • Robotic medical device market is area of active M&A as evidenced by JNJ’s recent +$5 billion acquisition of Auris Health, which may have implications for Stereotaxis.
  • In addition to leading position in robotic cardiac ablation market, Stereotaxis has broad clearance throughout vascular system, including neurovascular and peripheral anatomy.
  • Management/Board-led investment of $34 million has solidified balance sheet, and importantly, management sees no need for further capital raises to reach profitability.

While comparing STXS to two of its closes microcap peers, the author implies a price range of between $3.50/share to $15.72/share, based on its $35 million FY2019 sales estimate. Please see the author’s full valuation analysis in the article. We are going to take a closer look at his valuation assumptions.

As we mentioned in yesterday’s tweet, the author echoes many of our same bullish sentiments. You can see our full coverage on STXS here.