Neuronetics (NASDAQ:STIM) Issues Quarterly Earnings Results

Neuronetics (NASDAQ:STIM) announced its quarterly earnings results on Wednesday. The company reported ($0.02) earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of ($0.09) by $0.07, FiscalAI reports. The firm had revenue of $41.96 million for the quarter, compared to the consensus estimate of $40.42 million. Neuronetics had a negative net margin of 19.62% and a negative return on equity of 125.11%.

Here are the key takeaways from Neuronetics’ conference call:

• Revenue rose 12.5% to $42 million, while gross margin expanded to 52.2%; the company also reported positive operating income, adjusted EBITDA, and operating and investing cash flow for the quarter.
• Greenbrook revenue increased 20.1%, supported by revenue-cycle improvements and growth in SPRAVATO. Management said early results from its AI-enabled claims tool improved first-month collections by a low double-digit percentage, though clinic occupancy remains uneven, ranging from about 25% to 75%.
• NeuroStar recorded its strongest quarter for system sales, with more than half of units sold through capital or lease arrangements. Management said the broader go-to-market strategy is reaching larger accounts, but expects sessions revenue to continue trending slightly lower.
• Despite positive quarterly cash flow, the company still expects full-year cash flow from operating and investing of negative $10 million to negative $12 million. Full-year revenue guidance was unchanged at $160 million to $164 million.
• Management sees potential growth opportunities from its Wave Neuroscience partnership, an EHR integration, and a planned Compass Pathways launch in 2027. These opportunities remain subject to regulatory, commercial, and reimbursement execution.

Neuronetics Stock Performance

NASDAQ:STIM opened at $2.62 on Thursday. The company has a market cap of $199.48 million, a price-to-earnings ratio of -6.09 and a beta of 1.36. Neuronetics has a 1 year low of $0.80 and a 1 year high of $3.44. The stock’s 50 day simple moving average is $2.49 and its two-hundred day simple moving average is $1.88. The company has a debt-to-equity ratio of 2.84, a current ratio of 1.88 and a quick ratio of 1.69.

Wall Street Analysts Forecast Growth

STIM has been the topic of a number of research reports. Citigroup reissued a “market outperform” rating on shares of Neuronetics in a report on Tuesday, July 21st. B. Riley Financial started coverage on Neuronetics in a report on Friday, September 11th. They set a “buy” rating on the stock. BTIG Research reissued a “buy” rating and set a $6.00 price objective on shares of Neuronetics in a research report on Thursday, September 17th. Weiss Ratings reaffirmed a “sell (e+)” rating on shares of Neuronetics in a research report on Monday, September 14th. Finally, Wall Street Zen upgraded shares of Neuronetics from a “sell” rating to a “hold” rating in a research note on Sunday, July 12th. Four research analysts have rated the stock with a Buy rating and one has assigned a Sell rating to the company. According to data from MarketBeat.com, the company presently has an average rating of “Moderate Buy” and a consensus price target of $4.67.

Key Headlines Impacting Neuronetics

Here are the key news stories impacting Neuronetics this week:

• Positive Sentiment: Q3 revenue rose 12.5% year over year to about $42 million, topping estimates of roughly $40.4 million. The per-share loss narrowed to $0.02 from $0.13 a year earlier and beat the consensus estimate of a $0.09 loss. Neuronetics Q3 results
• Positive Sentiment: Brokerages’ consensus price target was reported at $4.67, above the stock’s recent price, suggesting potential upside in analysts’ expectations. Brokerage consensus target
• Neutral Sentiment: The company granted inducement awards to 14 non-executive employees. The grants may help with hiring and retention, though equity awards can dilute existing shareholders; the announcement provided no award amounts. Inducement grant announcement
• Negative Sentiment: Despite the improvement, Neuronetics still posted a quarterly net loss of about $1.7 million and has not yet reached profitability, leaving execution and cash generation as investor risks. Q3 loss and revenue report

Insider Activity at Neuronetics

In other news, major shareholder Jorey Chernett bought 18,000 shares of the stock in a transaction dated Friday, October 30th. The stock was purchased at an average cost of $2.27 per share, for a total transaction of $40,860.00. Following the transaction, the insider owned 10,620,988 shares of the company’s stock, valued at $24,109,642.76. The trade was a 0.17% increase in their ownership of the stock. The purchase was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. Corporate insiders own 8.40% of the company’s stock.

About Neuronetics

Neuronetics, Inc is a medical technology company that develops and commercializes noninvasive treatments for psychiatric and neurological disorders. Its primary product is NeuroStar TMS Therapy, which uses transcranial magnetic stimulation to deliver targeted magnetic pulses to areas of the brain associated with mood regulation.

NeuroStar TMS Therapy is cleared by the U.S. Food and Drug Administration for treating major depressive disorder in adults and adolescents, obsessive-compulsive disorder, and depression with anxious distress.