NEW YORK (TheStreet) -- Shares of ReWalk Robotics(RWLK) - Get Report are up by 3.7% to $14 on heavy volume in mid-morning trading on Monday, as the stock continues to benefit from the U.S. Department of Veteran Affairs agreement to pay for the company's robotic exoskeleton for paralyzed soldiers.
ReWalk shares spiked as much as 42% during Friday's session after the V.A. decided to invest in the company's device, which is strapped onto paraplegics to provide support as they learn to walk again.
ReWalk estimates that about half of the 42,000 U.S. veterans who have lost the use of their legs will be eligible for its device, creating a $1.9 billion market, according to Bloomberg.
"It's not difficult to see how many people need this, it's a question of can we get it to them and are the insurers going to accept this and provide it," said CEO Larry Jasinski. "This is the first of the major elements on the insurance side that were important."
About 2 million of ReWalk Robotics shares have changed hands so far today versus the stock's daily average of 290,661 shares.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate REWALK ROBOTICS LTD as a Sell with a ratings score of D. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been poor profit margins.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The gross profit margin for REWALK ROBOTICS LTD is currently extremely low, coming in at 7.47%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -548.84% is significantly below that of the industry average.
- REWALK ROBOTICS LTD has improved earnings per share by 17.2% in the most recent quarter compared to the same quarter a year ago. For the next year, the market is expecting a contraction of 75.5% in earnings (-$1.93 versus -$1.10).
- The revenue fell significantly faster than the industry average of 30.2%. Since the same quarter one year prior, revenues fell by 24.4%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- RWLK's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 41.34%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter.
- Compared to other companies in the Health Care Equipment & Supplies industry and the overall market, REWALK ROBOTICS LTD's return on equity significantly trails that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: RWLK