No surprises expected when InspireMD (NSPR) reports Q4 earnings

InspireMD (NYSE: NSPR) has incurred losses consistently over the past several years. Of late, shareholders have been apprehensive about their investments as things went from bad to worse, to the point where the company even faced de-listing from the New York Stock Exchange.

Related: InspireMD Q2 Earnings Conference Call Transcript

The Israel-based medical device maker will be publishing its fourth-quarter financial results Tuesday before the opening bell. It will be the first earnings announcement under new chief executive officer Marvin Slosman, who recently replaced long-term executive James Barry.

Estimates

Experts are of the view that the bottom-line would remain in the negative territory in the December-quarter, continuing the long-term trend. The consensus estimate is for a loss of $0.57 per share. Meanwhile, revenue is expected to nearly double to $1.6 million.

Cash Burn

The positive revenue estimate should allay stakeholders’ concerns about the continuing cash burn. However, in the absence of clear indications of a turnaround, the current level of spending looks unsustainable, which also points to the need to replenish liquidity.  

When its comes to driving growth, the company, which makes the CGuard embolic prevention system, bets on the growing awareness about the system in the healthcare sector. CGuard boasts of several unique advantages, compared to conventional therapies.  

Bright Spots

InspireMD might need to go a long way before achieving consistent profitability, but it is poised to thrive on the success of CGuard. The system is found to be effective in preventing strokes caused by carotid artery disease. MicroNetTM, the firm’s proprietary single fiber mesh technology that received two US patents last year, is also estimated to have contributed to revenue growth this time.

Past Performance

In the third quarter, loss narrowed to $1.26 per share from $2.47 per share a year earlier, aided by a 22% growth in revenues to $0.94 million. Orders for CGuard climbed to a record high.

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InspireMD’s shares have been in a perpetual downward spiral for the past several years, and traded at a multi-year low this week. The stock plunged 87% since last year and dropped 14% since the beginning of 2020.

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