The Fed’s persistent hawkish stance to tame the stubborn inflation and the consequent increase in recession fears have led the widely-followed stock indices to witness massive sell-offs this year.
While most well-known names in the market got caught in the brutal sell-off, penny stock Pulse Biosciences (PLSE) witnessed a solid uptrend, gaining 54.3% over the past month and 11.9% over the past three months.
PLSE operates as a novel bioelectric medicine company. It provides CellFX System, a tunable, software-enabled, and console-based platform used to treat various medical conditions using its Nano Pulse Stimulation technology.
The medical therapy company delivered impressive results for the second quarter that ended June 30, 2022. During the quarter, the company transitioned its commercial focus toward utilizing CellFX Systems in a select group of dermatology clinics. In addition, the company completed two commercial sales of CellFX Systems.
Furthermore, PLSE is expanding strategic opportunities within healthcare and anticipates a concentrated focus on the oncology, gastroenterology, and cardiac sectors.
PLSE is trading above its 50-day moving average of $1.73, indicating an uptrend. While the company is yet to turn profitable, Wall Street expects its loss to decline in the upcoming quarters, which could help the stock grab some more investor attention and maintain its momentum.
In terms of its forward EV/Sales, PLSE is trading at 73.74x compared to the industry average of 3.81x. The stock’s forward Price/Sales of 72.31x compares to the industry average of 4.25x.
Here is what could influence PLSE’s performance in the upcoming months:
Recent Positive Developments
On October 6, PLSE announced positive clinical data from an FDA-approved Investigational Device Exempt treatment and study on the use of Nano-Pulse Stimulation (NPS) procedure for low-risk basal cell carcinoma (BCC) lesions.
Here is what Kevin Danahy, President and Chief Executive Officer of Pulse Biosciences, said:
In September, PLSE received FDA 510(k) clearance for its CellFX System to treat sebaceous hyperplasia in patients with Fitzpatrick skin types I-III. The FDA clearance enables the company to support clinics in marketing and promoting CellFX treatments, specifically for patients with sebaceous hyperplasia.
Impressive Recent Financials
In the fiscal second quarter (ended June 2022), PLSE’s revenues totaled $265,000, including System revenue of $209,000 and Cycle Units revenue of $56,000.
The company’s non-GAAP operating expenses declined 21% year-over-year. Its non-GAAP net loss narrowed to $11.9 million from $12.6 million in the year-ago quarter.
Favorable Analyst Estimates
Analysts expect PLSE’s revenue for the fiscal 2023 first quarter (ending March 31) to come in at $800,000, indicating an increase of 80.2% from the prior-year period. The consensus revenue estimate of $3.89 million for fiscal 2023 indicates a 250.7% year-over-year improvement. Also, Wall Street expects the company’s loss to narrow by 6.3% for the quarter that ended September 2022 and 22.8% for the full year.
Technical Indicators Show Promise
According to MarketClub’s Trade Triangles, the long-term trend for PLSE has been UP since October 3, 2022, and its intermediate-term trend has been UP since September 12, 2022. However, the stock’s short-term trend has been DOWN since October 19, 2022.
The Trade Triangles are our proprietary indicators, comprised of weighted factors that include (but are not necessarily limited to) price change, percentage change, moving averages, and new highs/lows. The Trade Triangles point in the direction of short-term, intermediate, and long-term trends, looking for periods of alignment and, therefore, intense swings in price.
In terms of the Chart Analysis Score, another MarketClub proprietary tool, PLSE scored +75 on a scale from -100 (strong downtrend) to +100 (strong uptrend), indicating Bull Market Weakness. While PLSE shows signs of short-term weakness, it remains in the confines of a long-term uptrend.
The Chart Analysis Score measures trend strength and direction based on five different timing thresholds. This tool considers intraday price action; new daily, weekly, and monthly highs and lows; and moving averages.
What's Next for This Penny Stock?
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The MarketClub Team