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In a stark reflection of the challenges facing the medical technology sector, Zynex Inc. (NASDAQ:ZYXI) shares have tumbled to a 52-week low, touching down at $2.12. This latest price level underscores a precipitous decline for the company, which has seen its stock value erode by an alarming 82.69% over the past year. The company, with a market capitalization of $68 million and impressive gross margins of nearly 80%, maintains strong liquidity with a current ratio of 4.46. InvestingPro analysis indicates the stock is currently in oversold territory. Investors have been grappling with a mix of industry-specific headwinds and broader market pressures, which have collectively weighed heavily on Zynex’s market performance. The company, known for its non-invasive medical devices for pain management and rehabilitation, is now at a critical juncture as it navigates through a significantly transformed competitive landscape. According to InvestingPro’s Fair Value analysis, the stock appears undervalued, with 16 additional ProTips available to subscribers through the comprehensive Pro Research Report.
In other recent news, Zynex Inc. has experienced several significant developments. The company reported a net loss of $615,000 for the fourth quarter of 2024, with earnings per share (EPS) of -$0.02, missing the forecasted EPS of $0.10. Revenue for the quarter was $46 million, falling short of the expected $53.3 million. This revenue shortfall was partly due to a temporary suspension of payments from Tricare, which accounts for a substantial portion of Zynex’s revenue. Despite these challenges, the company saw a 4.4% year-over-year growth in total revenue for 2024, reaching $192.4 million, and a net income of $3.0 million for the year.
In response to operational concerns, RBC Capital Markets downgraded Zynex’s stock rating from Outperform to Sector Perform, reducing its price target to $5.50. Similarly, H.C. Wainwright adjusted its 12-month price target from $17.00 to $15.00, although it maintained a Buy rating. The company is also undergoing changes in its auditing practices, with CBIZ (NYSE:CBZ) CPAs P.C. appointed as the new independent registered accounting firm following Marcum LLP’s resignation. Zynex is addressing internal control weaknesses and plans to reduce its workforce by 15% to align costs with anticipated revenue levels. The company continues to expand payor coverage and is scheduled to meet with Tricare in April to discuss payment issues.
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