Nephros (NEPH) AI Stock Analysis

• Market Cap: $22.58M
• Dividend Yield: N/A
• Average Volume (3M): 14.46K
• Price to Earnings (P/E): 313.2
• Beta (1Y): 0.72
• Revenue Growth: -0.53%
• EPS Growth: N/A
• Country: US
• Employees: 31
• Sector: Healthcare
• Sector Strength: 78
• Industry: Medical - Instruments & Supplies
• EPS (TTM): <0.01
• Shares Outstanding: 10,600,350
• 10 Day Avg. Volume: 13,226
• 30 Day Avg. Volume: 14,460
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.21
• Price to Cash Flow (P/CF): -6.50
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $4.50
• Price Target Upside: 111.27% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

Nephros is showing significant progress towards profitability with improved financial metrics and strategic growth initiatives. However, challenges in revenue consistency and cash flow, combined with high valuation, suggest careful consideration for investors. The company's technical indicators are currently favorable, but the high P/E ratio warrants caution. Corporate changes indicate positive strategic alignment and leadership stability.

Positive Factors

Earnings

Nephros reported 4Q24 results with revenue and GAAP EPS above both consensus and analyst estimates.

Financial Performance

NEPH reported its first profitable quarter, reflecting cost management efforts and operational improvements.

Product Development

The new HydraGuard UltraFilter opens new customer sites with stringent water safety requirements, expanding potential markets.

Negative Factors

Market Valuation

Nephros trades at a lower EV/revenue multiple compared to peers, with potential for growth through channel expansion and new verticals.

Nephros Business Overview & Revenue Model

Company Description

Nephros, Inc. develops and sells high performance water solutions to the medical and commercial markets in the United States. The company operates in three segments: Water Filtration, Pathogen Detection, and Renal Products. It offers ultrafiltration products that are used in dialysis centers for the removal of biological contaminants from water and bicarbonate concentrate; and in hospitals for the prevention of infection from waterborne pathogens, such as legionella and pseudomonas, as well as in military and outdoor recreation, commercial, and other healthcare facilities. The company also develops and sells real-time water testing systems to provide actionable data on waterborne pathogens; and medical device products for patients with renal disease, including a 2nd generation hemodiafiltration system for the treatment of patients with end stage renal disease. In addition, it offers water filters that improve the taste and odor of water, as well as reduce biofilm, bacteria, and scale build-up in downstream equipment under the Nephros and AETHER brands for the food service, hospitality, convenience store, and health care markets. The company was incorporated in 1997 and is headquartered in South Orange, New Jersey.

How the Company Makes Money

Nephros makes money primarily through the sale of its water filtration and purification products to healthcare facilities, including hospitals and dialysis centers. The company's revenue model is based on direct product sales and recurring revenue from filter replacements, which are necessary to maintain the efficacy of their systems. Nephros also engages in strategic partnerships with other healthcare companies to expand its market reach and enhance its product offerings. Its earnings are significantly influenced by the demand for high-quality water filtration systems in the healthcare industry, regulatory requirements, and its ability to innovate and improve its product line.

Nephros Financial Statement Overview

Summary

Nephros is improving with a first profitable quarter and higher gross margins. While the company maintains low leverage and a strong equity position, challenges in revenue growth and cash flow generation limit further upside.

Income Statement

Nephros has shown improvements in net income, transitioning from a loss in previous years to a profit in the most recent year. The gross profit margin increased from 57% to 62%, indicating improved cost efficiency. However, revenue has slightly decreased over the past year, and EBIT and EBITDA margins remain thin, suggesting challenges in operational efficiency.

Balance Sheet

The balance sheet reflects a stable equity position with a debt-to-equity ratio of 0.16, indicating low leverage. The equity ratio remains strong at 76.6%, reflecting a solid capital structure. Despite declining total assets, the company's liabilities have decreased, enhancing financial stability.

Cash Flow

Cash flow from operations turned negative this year, reversing from a positive position last year. Free cash flow growth was negative, indicating a need for better cash management. The operating cash flow to net income ratio is unfavorable, suggesting room for improvement in cash generation relative to profitability.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
14.16M	14.24M	9.97M	10.40M	8.56M
	Gross Profit
8.72M	8.40M	4.73M	5.74M	4.91M
	EBIT
6.00K	-1.59M	-4.33M	-4.33M	-4.50M
	EBITDA
227.00K	-1.36M	-3.91M	-2.23M	-3.94M
	Net Income Common Stockholders
74.00K	-1.57M	-7.32M	-4.17M	-4.72M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.76M	4.31M	3.63M	6.97M	8.25M
	Total Assets
11.21M	11.86M	11.00M	17.65M	18.51M
	Total Debt
1.41M	1.84M	1.09M	1.12M	2.17M
	Net Debt
-2.35M	-2.47M	-2.54M	-5.85M	-6.08M
	Total Liabilities
2.63M	3.50M	2.12M	2.90M	2.94M
	Stockholders Equity
8.59M	8.36M	5.59M	11.70M	12.52M
Cash Flow		Free Cash Flow
-547.00K	752.00K	-3.37M	-1.45M	-7.14M
	Operating Cash Flow
-492.00K	827.00K	-3.23M	-1.42M	-6.90M
	Investing Cash Flow
-50.00K	-75.00K	-137.00K	-85.00K	-239.00K
	Financing Cash Flow
-5.00K	-79.00K	34.00K	237.00K	11.22M

Nephros Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 2.13
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NEPH, the sentiment is Positive. The current price of 2.13 is above the 20-day moving average (MA) of 1.62, above the 50-day MA of 1.59, and above the 200-day MA of 1.71, indicating a bullish trend. The MACD of 0.04 indicates Negative momentum. The RSI at 67.54 is Neutral, neither overbought nor oversold. The STOCH value of 80.42 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NEPH.

Nephros Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MTD	72 Outperform	$24.10B	28.93	-680.23%	―	2.22%	12.78%
NEPH	63 Neutral	$22.58M	313.24	0.87%	―	-0.53%	―
TNDM	56 Neutral	$1.25B	―	-33.30%	―	25.74%	57.18%
ICUI	53 Neutral	$3.47B	―	-5.76%	―	5.28%	-292.14%
Sector *	48 Neutral	$6.86B	1.11	-50.22%	2.47%	16.71%	1.53%
QDEL	46 Neutral	$2.30B	―	-50.74%	―	-7.03%	-20233.78%
SENS	43 Neutral	$433.42M	―	-166.29%	―	0.37%	-20.49%

Nephros Corporate Events

Nephros Amends CFO Employment Terms for Strategic Growth

On February 26, 2025, Nephros, Inc. amended the employment terms of its Chief Financial Officer, Judith Krandel. The amendment grants Ms. Krandel two 10-year stock options under the company’s 2024 Equity Incentive Plan, with specific vesting conditions tied to her continued employment and the company’s strategic transactions. Additionally, her annual performance bonus target is increased to 30% of her base salary. This amendment could potentially strengthen the company’s leadership stability and incentivize growth-oriented strategies.