Sunday, March 22, 2015

Will ReWalk run up soon?


There are millions and millions of disabled people who can't walk on Earth. ReWAlk (RWLK) has a unique and noble mission; helping those poeple walk again with the help of exoskeletons. Altough it is easy to be touched by their offering, are ReWalk shares worth buying?

With a capitalization of about $150M, ReWalk has a lot of room to grow. Furthermore, it is the only exoskeleton that the FDA approved, so basically there is no direct competition. Of course, there is indirect competition such as stem cells based potential cures, but those are probably decades away. ReWalk can prove to be the perfect solution in the meantime.

However, the problem is that ReWalk is not affordable at $85K. Seriously, how many disabled people can afford that? Moreover the exoskeleton system is kind of clumsy and heavy. ReWalk is aware of those problems and the company is working both at lowering the price and improving the technology. Patience is required here, but how long should we wait? The stock market is already at his - or close to - its peak in my opinion. What if there's a crash soon? Will ReWalk be able to perform in an hostile economy? ReWalk already has poor financials and has no room for errors. 

On the bright side, the company revenue tripled in Q4 2014 to $1.5M. Also, I see the lockup expiration on march 11th being passed has a good thing. Investors that got shares at IPO had a chance to sell them and those who wanted to get out did.

My probabilistic model shows that ReWalk should go back up near to $20 in the next months. However, that's contingent of no new major road bump. I consider RWLK to be a speculative buy, but it can be rewarding to swing trade it.

No comments:

Post a Comment

Share