Stereotaxis (STXS) Stock Gains on Patent Win

NEW YORK (TheStreet) -- Shares of Stereotaxis (STXS) were gaining 6.6% to $1.60 on heavy trading volume Tuesday after the medical devices company was awarded a patent covering the transmission of data for its Odyssey Information Management Solution.

The U.S. Patent and Trademark Office issued Stereotaxis U.S. Patent No. 9,111,016 to entitled "Management of Live Remote Medical Display." The patent lets the company develop future features in the Odyssey Information Management Solution that optimizes data transmission across a network to a high-definition display.

"As the amount of high-resolution video, imaging, and graphics being transmitted across hospital networks continues to grow, the ability to optimize and manage bandwidth usage becomes increasingly important," CEO William C. Mills said in a statement.

"The award of this patent further builds on our extensive intellectual property portfolio of more than 100 issued patents that protects our existing technology and future enhancements and extensions of our innovative solutions for the interventional lab workplace," Mills continued. 

About 2.8 million shares of Stereotaxis were traded by 12:28 p.m. Tuesday, above the company's average trading volume of about 276,000 shares a day.

TheStreet Ratings team rates STEREOTAXIS INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

"We rate STEREOTAXIS INC (STXS) a SELL. This is driven by a few notable weaknesses, 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 a generally disappointing historical performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • STXS'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 47.67%, 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. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The gross profit margin for STEREOTAXIS INC is currently very high, coming in at 70.99%. Regardless of STXS's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, STXS's net profit margin of -15.91% significantly underperformed when compared to the industry average.
  • Net operating cash flow has significantly increased by 70.25% to -$0.92 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 21.53%.
  • STEREOTAXIS INC has improved earnings per share by 30.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. During the past fiscal year, STEREOTAXIS INC continued to lose money by earning -$0.27 versus -$5.70 in the prior year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Health Care Equipment & Supplies industry. The net income increased by 20.8% when compared to the same quarter one year prior, going from -$1.94 million to -$1.54 million.
  • You can view the full analysis from the report here: STXS Ratings Report

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