STXS has potential as a growth play, with chart support in place
Stereotaxis, Inc. (NYSE:STXS) produces robotic technologies designed to enhance the treatment of arrhythmias and perform endovascular procedures. The medical device stock scored a seven-year high of $8.97 earlier today, and is up 75% in 2021. So given all the positive price action, the question should be for potential investors is: how much more can it climb?
There's chart support in place at STXS' 100-day moving average, which contained a pullback in May. Keep an eye on the $9 level, which is triple the shares' Nov. 6 annual lows. There isn't a lot of potential for upgrades though, considering all three brokerages rate the stock a "strong buy."
During the company's earnings call to discuss the first quarter of 2021, Stereotaxis highlighted a 50% increase in revenue. STXS' revenues totaled $8.6 million at the end of the first quarter, up from $5.8 million in the prior year’s first quarter. Stereotaxis also has a great balance sheet with $44.1 million in cash and only $3.89 million in total debt, giving STXS the time and resources to continue producing and refining its technology.
However, Stereotaxis has yet to see consistent growth on the top- and bottom-lines. Between fiscal 2017 and fiscal 2020, STXS's revenues decreased by more than 14%. It has only been in the past 12 months that the company has seen a 10.7% growth in revenues. Overall, the company’s balance sheet places it in a good position to expand the business substantially, but it will be vital for Stereotaxis to begin seeing consistent revenue growth before investors can wisely jump into the investment.