Neuronetics Cut Third Quarter Revenue Forecast; Shares reach 27% pre-market
Commercial-stage medical technology company Neuronetics Inc. (STEM) expects to report total revenue of $ 13.8 million in the third quarter of 2021, lower than previously released guidance of $ 15 to 16 million and Street’s estimate of $ 16.51 million.
Following the announcement, the company’s shares were down nearly 27%, at the time of writing, in pre-market trading on Wednesday.
Based in Pennsylvania, Neuronetics is engaged in the design, development and sale of products to treat patients with neurological disorders. (See the best Smart Score stocks on TipRanks)
For 2021, the company is forecasting revenue of between $ 53.3 million and $ 54.3 million, below the previously announced range of $ 59 million to $ 63 million and analysts’ expectations of $ 61.67 million.
Neuronetics President and CEO Keith J. Sullivan said, “Our third quarter revenue was lower than expected, primarily due to the extra time it takes our new sales team to achieve productivity. optimal due to extended sales cycles driven in part by the uncertain COVID-19 environment. “
“Despite the market uncertainty, we have continued to make solid progress in our strategic initiatives to drive future growth,” added Sullivan.
After the company announced preliminary earnings for the third quarter, Piper Sandler analyst Matthew O’Brien reiterated a buy rating on the stock with a price target of $ 12 (upside potential of 87, 5%).
The analyst expects a sequentially “weaker” Q4. He said that while the update was not surprising, it would not be well received by investors.
Overall, the stock has a moderate buy consensus rating based on 2 buy and 1 hold. Neuronetics’ average price target of $ 15 implies upside potential of 134.4%. Stocks have lost around 50% in the past six months.
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