NVRO Earnings Flop Brings On The Bear Notes

Analysts have already started issuing bear notes in response

Digital Content Manager
May 10, 2019 at 9:43 AM
facebook twitter linkedin

A first-quarter revenue miss has medical device concern Nevro Corp (NYSE:NRVO) trading lower today. The shares are down 5% at $59.67 in early trading, after reporting a 6% revenue drop to $82.1 million versus analysts' estimated $87.5 million. The firm cited a decision earlier this year to reduce the impact of high-volume product orders for the drop, while it also suspended its full-year forecast following the appointment of its new CEO. NVRO also posted a wider-than-expected loss of $1.45 per share, too.

Analysts are already responding to NVRO's first-quarter flop in droves. Morgan Stanley slashed its target price to $64 from $70, while Leernik cut its estimate to $70 from $75. Canaccord Genuity got in on the action too, with a downgrade to "hold" from "buy," and a price-target cut to $50 -- the lowest estimate on the books. Nevro is susceptible to even more downgrades, though, with seven "strong buy" ratings, two "holds," and only one "strong sell" prior to today. 

A massive bull gap in late-March had NVRO up 61.4% at last night's close, with the $60 level stepping up as support. The 50-day moving average also could be supportive, currently sitting around the $57 level.

Short sellers are likely celebrating today, with short interest up 7.8% in the last two reporting periods. The 3.47 million shares sold short now represent a whopping 11.8% of the stock's available float, and would take over seven days to cover, at NVRO's average trading volume. 


Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

Schaeffer's Daily Bulletin Offer


Special Offers from Schaeffer's Trading Partners