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Nephros Inc (NEPH)
NASDAQ:NEPH
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Nephros
(NASDAQ:NEPH)
61Neutral
Positive Factors
Earnings
Nephros reported its first profitable quarter, reflecting cost management efforts and operational improvements.
Product Innovation
The new HydraGuard UltraFilter opens new customer sites with stringent water safety requirements, expanding potential markets.
Valuation
The valuation suggests NEPH trades at a compelling value compared to peers due to expansion efforts and growth initiatives.
Negative Factors
Competition
Nephros trades at a lower EV/revenue multiple compared to peers, indicating potential undervaluation concerns compared to competitors.
Nephros (NEPH) vs. S&P 500 (SPY)
Market Cap
$19.29M
Dividend YieldN/A
Average Volume (3M)10.06K
Price to Earnings (P/E)267.6
Beta (1Y)0.01
Revenue Growth-0.53%
EPS GrowthN/A
CountryUS
Employees31
SectorHealthcare
Sector Strength58
IndustryMedical - Instruments & Supplies
Share Statistics
EPS (TTM)<0.01
Shares Outstanding10,600,350
10 Day Avg. Volume4,706
30 Day Avg. Volume10,065
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.68
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit1.51
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$4.50Price Target Upside136.84% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Nephros Business Overview & Revenue Model
Company DescriptionNephros, 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 MoneyNephros 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.62
Positive
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.70
Positive
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.55
Neutral
| 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
Neutral
1.90
Price Trends
1.74
Positive
1.65
Positive
1.70
Positive
Market Momentum
0.05
Positive
51.36
Neutral
54.25
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NEPH, the sentiment is Neutral. The current price of 1.9 is below the 20-day moving average (MA) of 1.94, above the 50-day MA of 1.74, and above the 200-day MA of 1.70, indicating a neutral trend. The MACD of 0.05 indicates Positive momentum. The RSI at 51.36 is Neutral, neither overbought nor oversold. The STOCH value of 54.25 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NEPH.
Nephros Risk Analysis
Nephros disclosed 24 risk factors in its most recent earnings report. Nephros reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Nephros Peers Comparison
Overall Rating
UnderperformOutperform
Sector (52)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $19.29M | 267.65 | 0.87% | ― | -0.53% | ― | |
55 Neutral | $71.54M | ― | -68.09% | ― | -12.19% | 36.73% | |
52 Neutral | $21.99M | ― | -12.75% | ― | -24.19% | -67.34% | |
52 Neutral | $5.36B | 3.88 | -42.93% | 2.87% | 17.85% | 1.45% | |
49 Neutral | $30.66M | ― | -38.56% | ― | -2.78% | -124.17% | |
39 Underperform | $15.04M | ― | -18.19% | ― | -16.14% | -256.50% | |
39 Underperform | $31.77M | ― | -182.18% | ― | 51.97% | 9.94% |
* Healthcare Sector Average
Performance Comparison
NEPH
Nephros
1.90
-0.30
-13.64%
HBIO
Harvard Bioscience
0.35
-3.50
-90.91%
RVP
Retractable Technologies
0.74
-0.35
-32.11%
MLSS
Milestone Scientific
1.09
0.44
67.69%
POCI
Precision Optics Corporation
4.21
-1.20
-22.18%
FEMY
Femasys
1.16
-0.13
-10.08%
Nephros Earnings Call Summary
Earnings Call Date:Mar 06, 2025
(Q3-2024)
| % Change Since: 32.87%|
Next Earnings Date:May 07, 2025
Earnings Call Sentiment Neutral
While Nephros achieved its first profitable quarter and improved its gross margin and adjusted EBITDA, the company faced a decline in year-over-year revenue and cash reserves, along with regional underperformance challenges. Despite these issues, strategic initiatives and cost management have positioned Nephros for potential future growth.Q3-2024 Updates
Positive Updates
First Profitable Quarter Achieved
Nephros reported its first profitable quarter with a net income of $0.2 million compared to a net loss of $0.2 million in Q3 of the previous year.
Improved Gross Margin
Gross margin increased to 61% from 59% in Q3 2023, reflecting improved terms with the largest supplier.
Significant Improvement in Adjusted EBITDA
Adjusted EBITDA for Q3 was $295,000, a substantial increase from $11,000 in the same quarter last year.
SG&A Expenses Reduction
SG&A expenses were reduced by 19% to $1.7 million from $2.1 million in Q3 2023 due to lower stock compensation and bonus accruals.
Strategic Advancements and Future Growth
Nephros is expanding into new markets such as sterile processing, laboratories, and dental practices and is exploring partnerships for solutions to nano and microplastic contaminations.
Negative Updates
Decline in Year-Over-Year Revenue
Q3 net revenue was $3.5 million, a 6% decline compared to Q3 2023, mainly due to underperformance in programmatic revenue.
Cash and Cash Equivalents Decline
Cash and cash equivalents decreased to $2.5 million from $4.3 million at the end of 2023, primarily due to operating losses in the first half of 2024.
Underperformance in Specific Regions
The company faced challenges in specific regions, with some larger accounts showing slower order patterns.
Company Guidance
During the Nephros Q3 2024 earnings call, the company reported achieving its first profitable quarter since inception, with a net income of $0.2 million compared to a net loss of $0.2 million in Q3 2023. Net revenue for the quarter was $3.5 million, up 8% from Q2 2024 but down 6% from Q3 2023. The gross margin improved to 61% from 59% in Q3 2023, driven by better terms with a major supplier. Adjusted EBITDA for the quarter was $295,000, a significant improvement from $11,000 in the previous year. SG&A expenses were reduced by 19% to $1.7 million, contributing to the positive financial outcome. The company highlighted strategic advancements, such as the introduction of digital support tools for filter installation and plans to expand into new markets like sterile processing and dental practices. Cash and cash equivalents stood at $2.5 million as of September 30, 2024, down from $4.3 million at the end of 2023, primarily due to earlier operating losses and inventory investments.Nephros Corporate Events
Executive/Board ChangesShareholder Meetings
Nephros Board Member Alisa Lask to Step Down
Neutral
Apr 28, 2025
On April 23, 2025, Alisa Lask informed Nephros, Inc. that she will not seek re-election to the Board of Directors at the upcoming annual stockholders meeting on June 16, 2025. Her decision is not due to any disagreements with the company’s operations or policies.
Spark’s Take on NEPH Stock
According to Spark, TipRanks’ AI Analyst, NEPH is a Neutral.
Nephros shows strengths in financial stability and technical momentum, supported by strategic leadership initiatives. However, the extremely high P/E ratio indicates potential overvaluation, and challenges in revenue consistency and cash flow generation remain key concerns.
To see Spark’s full report on NEPH stock, click here.
Executive/Board ChangesBusiness Operations and Strategy
Nephros Amends CFO Employment Terms for Strategic Growth
Positive
Mar 4, 2025
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.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.