Needham & Company analyst Mike Matson lowered his price target on Amedica Corporation (NASDAQ: AMDA) to $1.00 (from $3.00) but maintained a Buy rating following disappointing Q1 results.
Matson commented, "AMDA's 1Q15 revenue and EPS were below consensus. Revenue declined 18% Y/Y and 8% sequentially as silicon nitride (SiN) implant sales growth slowed to 7%. AMDA lowered its 2015 revenue guidance to $19-20M from $23-24M (vs. consensus of $23.3M) with SiN growth of 15-20% (vs. 30-40% previously). We expect the composite cervical spacers to be cleared by the FDA later this year and to serve as a growth driver, and we also expect additional private label and/or OEM agreements (AMDA expects four additional agreements this year) to serve as catalysts and to drive revenue growth."
The last sentence is the key:
Mr. Yitzhak Nissan, Chairman of the Board and Chief Executive Officer, commented: "During the first quarter of 2015, we continued to experience weakness in demand for printed circuit boards and as a result, a decline in sales to the defense sector. We have been able to soften the impact of the $2.6 million decline in sales by reducing expenses. As a result of our cost reduction efforts and the increase in the US dollar exchange rate against the NIS, our operating loss was even reduced by $13,000 from the first quarter of 2014. We continue with our efforts to improve our operational efficiencies.
"We have been focused on increasing sales to the US market where we believe customers perceive our products as having both high reliability and top quality. Incoming orders from the US during the first quarter of 2015 increased by 11% compared to the first quarter of 2014. We believe that as a result of our increased marketing activities and our recent expansion of our sales force in the West Coast we will be able to increase our US sales this year. The equipment we recently purchased has been installed and already offers us increased operational flexibility and improved product quality."
"Based on these steps, I am optimistic regarding the Company's ability to return to sustainable profitability in the future,"
Price reflects Q1 results but the market lloks forward
1Q will be the infleccion point that everyone wants to see.
Breakeven point is no $10.5 million.
Return to sustainable profitability starting in 2Q 2015
With excellent operational efficiency and inceased sales in the US 2Q will likely be profitable. 11% increase in the US in Q1 did not affect 1Q but it will going foward.
Happy with results and Outlook. Consistet with Ddeputy CEO Tulman at IPC show.
"Orders have picked up starting in February .....we have some very nice orders for the coming months....2015 will be very ood for us
Current 0.6 times sales is with full 60 million sahe due to warrant dilution
FDA approval likely a week after earnings per 90-day deadlina
Thank you for the link!
Lucky you. I got in this AM. This puppy will be 50c++ after earnings
Thank you for the tip