BioSig Technologies Inc drew an ‘Outperform’ rating from Noble Capital, which noted that "stronger commercialization efforts” are underway for the company’s PURE (Precise Uninterrupted Real-time evaluation of Electrograms) EP systems after the first quarter.
In a note to clients, Noble Capital analysts observed that BioSig recorded no PURE EP unit sales during the quarter, which was “below our expectations of three units”. However, they felt that BioSig still made great strides on multiple fronts as it accelerates commercial momentum for developing a national-installed base of its PURE EP systems.
“The company received strong signals from facilities, but contracts were not signed by the end of the quarter. We expect agreements in the second quarter,” said analysts.
“Total expenses, reduced by overhead reduction, ran higher than our expected levels as the company added back staff as part of its commercial buildout and official June 1 rollout,” they added.
In preparation for the commercial buildout for PURE EP, BioSig has already filed an At-The-Market (ATM) agreement for up to $10 million in stock. This did not surprise Noble, which had expected a capital raise in the second half of 2022.
Meanwhile, the commercialization buildout is gathering pace.
“The new commercial team, brought in late 2021 and 1Q 2022, continue to focus on a national strategy, going from a more regional focus, with an official June 1 rollout,” noted the Noble Capital analysts.
“The pipeline of leads has increased, and the company has better sales options than in 2021. The company believes 60-70% of PURE EP units contracted are expected to be leased, moving past capital budget committees more quickly and enhancing cash flow.”
Noble noted it was “a matter of when, not if,” that activity will increase in the coming quarters despite the much lower-than-expected commercialization in the 1Q.
“We are, however, reducing our 2022 expected revenues for the 1Q shortfall and a slower possible rollout in the second and third quarter. We are also increasing expenses given new headcount,” said the analysts. “Our 2022 EPS expectations are also revised lower, moving from a loss of $0.58 per share to a loss of $0.63 per share.”
However, they were very clear that while 2022 is off to “a sluggish start, stronger commercialization efforts underway should increase interest in PURE EP as a desirable component of electrophysiology labs in the US and abroad.”
“We are keeping our one-year price target at $4,” concluded the analysts.
BioSig currently trades at around $1.15 on the tech-dominated Nasdaq.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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