MRI Interventions Inc (OTCMKTS:MRIC) is a penny stock that recently broke down sharply below its near-term pattern confines in a very high volume move. We wanted to take a look at the move and the action in the stock relative to its recent catalysts to get a sense of the degree to which there might be an opportunity in the works here. The company announced preliminary results for its second quarter ended June 30, 2017 on Tuesday, a day after shares broke key support.
The only announcement out in concert with the breakdown was a notice of effectiveness from the SEC, which is a public declaration by the Securities and Exchange Commission that a public company’s registration statement has been accepted. “For shares in a public company to trade on the open market they must be registered by the company. These registration statements are reviewed by the Commission for a period of time before approval is given, and this notice marks the successful completion of this review process.” We will look at the preliminary results below.
MRI Interventions Inc (OTCMKTS:MRIC) frames itself as a commercial stage medical technology company that is focused on creating innovative platforms for performing the next generation of minimally-invasive surgical procedures.
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The company’s FDA-cleared and CE-marked ClearPoint system utilizes a hospital’s existing diagnostic or intraoperative MRI scanner to enable a range of minimally-invasive procedures in the brain. Building on the imaging power of MRI, the company’s interventional platforms strive to improve patient care while reducing procedure costs and times.
According to company materials, “MRIC is creating innovative platforms for performing the next generation of minimally invasive surgical procedures in the brain. The ClearPoint Neuro Navigation System, which has received 510(k) clearance and is CE marked, utilizes a hospital’s existing diagnostic or intraoperative MRI suite to enable a range of minimally-invasive procedures in the brain.”
As noted above, it is difficult to find a catalyst driving the selling to start this week. However, the company just put out preliminary results, which are quite impressive, at least superficially. That suggests there may be something more going on under the surface driving the selling, and the move to announce preliminary financial results (which is not necessary) may have been management’s response to the selling in defense of share prices.
According to the release, reflecting accelerating utilization and an increasing number of ClearPoint sites, total revenue for the three months ended June 30, 2017 was $2.0 million, compared with $1.1 million for the same period in 2016, a year-over-year increase of $872,000, or 79%.
“The Company also reported its ninth consecutive quarter of record procedures, at 162 ClearPoint Neuro Navigation System procedures for the second quarter, a 30% increase. This compares with 146 in the first quarter and 125 in the year-ago second quarter… ClearPoint disposable product sales were $1.4 million for the three months ended June 30, 2017, compared with $1.0 million for the same period in 2016, representing an increase of $406,000, or 39%.”
We’ve witnessed just shy of -30% shaved off of share prices of the company just during the trailing week. That said, market participants may want to pay attention to this stock. MRIC is a stock whose past is littered with sudden rips. What’s more, the company has benefitted from a jump in recent trading volume to the tune of exceeding 1000% over the long run average.
Traders should note this as important due to the very limited float size in the stock (of 1.5M shares). This type of thing is something to watch out for: ramping trading activity can overwhelm available supply in a stock with this type of small float, leading to an upward burst in prices.
Earning a current market cap value of $21.7M, MRI Interventions Inc (OTCMKTS:MRIC) has a reserve ($2M) of cash on the books, which is balanced by virtually no total current liabilities. MRIC is pulling in trailing 12-month revenues of $6.4M. In addition, the company is seeing major top line growth, with y/y quarterly revenues growing at 44%. This is an exciting story, and we look forward to a follow-up chapter as events transpire. For continuing coverage on shares of $MRIC stock, as well as our other hot stock picks, sign up for our free newsletter today and get our next hot stock pick!
Disclosure: we hold no position in $MRIC, either long or short, and we have not been compensated for this article.