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Tenon Medical, Inc. (TNON)
NASDAQ:TNON
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Tenon Medical, Inc.
(NASDAQ:TNON)
43Neutral
Positive Factors
Clinical trial data
Encouraging interim data from its flagship clinical trial is seen as an important tool in pursuing improved payor reimbursement.
Growth strategy
The company’s expanded physician training workshops and new salesforce investments should aid in identifying high-quality physician leads and act as a catalyst to drive growth in procedure volumes.
Innovation
The recent alpha launch of the Catamaran System SE expands its use cases and typifies its commitment to innovation.
Negative Factors
Financial performance
The company's 3Q24 revenue was below expectations due to unforeseen reimbursement headwinds.
Price target
Unforeseen headwinds in receiving reimbursement from payors have caused a tempering of the 12-month outlook and a lowered price target.
Reimbursement challenges
The publication of interim results from the company’s post-market study, anticipated by the end of 3Q24, could serve as a significant catalyst as favorable safety and efficacy data can be leveraged in discussions with insurance payors to secure reimbursement for Catamaran procedures.
Tenon Medical, Inc. (TNON) vs. S&P 500 (SPY)
Market Cap
$3.92M
Dividend YieldN/A
Average Volume (3M)127.12K
Price to Earnings (P/E)―
Beta (1Y)1.07
Revenue Growth38.30%
EPS Growth86.56%
CountryUS
Employees21
SectorHealthcare
Sector Strength78
IndustryMedical Equipment & Supplies
Share Statistics
EPS (TTM)-31.46
Shares Outstanding3,136,589
10 Day Avg. Volume193,862
30 Day Avg. Volume127,118
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.23
Price to Cash Flow (P/CF)-0.40
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$8.00Price Target Upside540.00% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering0
Tenon Medical, Inc. Business Overview & Revenue Model
Company DescriptionTenon Medical, Inc. (TNON) is a medical device company focused on developing and commercializing innovative surgical solutions for specific medical conditions. The company primarily operates in the healthcare sector, specializing in the design and production of devices used in orthopedic surgeries. Tenon Medical aims to improve surgical outcomes through its proprietary technology and specialized products.
How the Company Makes MoneyTenon Medical, Inc. generates revenue primarily through the sale of its medical devices to healthcare providers, including hospitals and surgical centers. The company's revenue model is based on direct sales and distribution agreements that enable the widespread adoption of its proprietary surgical solutions. Key revenue streams include the sale of its flagship products, which are used in specific orthopedic procedures. Significant partnerships with medical institutions and distribution networks contribute to the company's earnings by expanding its market reach and facilitating the adoption of its technologies among healthcare professionals.
Tenon Medical, Inc. Financial Statement Overview
Summary
Tenon Medical, Inc. has shown revenue growth but is still facing substantial losses with negative EBIT and net income. The balance sheet reflects low debt but limited financial stability due to negative equity returns. Cash flows are negative, raising sustainability concerns despite some external funding.Income Statement
Tenon Medical, Inc. has shown some growth in revenue, increasing from $69,100 in 2022 to $3,315,000 in the TTM (Trailing-Twelve-Months). However, the company continues to operate at a loss with a negative EBIT and net income, leading to low profitability metrics such as gross profit margin of 48.44% and a net profit margin of -413.84% for the TTM. The EBIT margin is notably negative, indicating operational challenges.42
Neutral
Balance Sheet
The balance sheet shows a relatively low debt-to-equity ratio of 0.06 in the TTM, suggesting manageable leverage. However, the company has a low equity ratio of 62.83%, hinting at limited financial stability. Return on equity is negative, reflecting significant losses impacting shareholder value.35
Negative
Cash Flow
The cash flow statement reveals negative free cash flow at -$9,694,000 and operating cash flow of -$9,379,000 in the TTM, indicating financial strain. The operating cash flow to net income ratio, although negative, suggests ongoing efforts to manage cash despite losses. Financing cash flow is positive due to capital raised, but the reliance on external funding raises sustainability concerns.38
Negative
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 328.80K | 2.93M | 691.00K | 159.80K | 43.82K | 53.64K | Gross Profit |
| -251.97K | 1.24M | -641.00K | 105.03K | 25.56K | 35.38K | EBIT |
| -12.19M | -15.73M | -18.73M | -6.46M | -536.29K | -533.44K | EBITDA |
| -11.90M | -15.53M | -18.27M | -6.35M | -537.52K | -30.00 | Net Income Common Stockholders |
| -13.33M | -15.58M | -19.11M | -7.67M | -753.02K | -509.58K |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 245.63K | 2.43M | 8.57M | 7.32M | 245.63K | 151.97K | Total Assets |
| 390.90K | 6.34M | 11.09M | 9.27M | 390.90K | 268.45K | Total Debt |
| 574.98K | 1.86M | 911.00K | 14.62M | 574.98K | 927.80K | Net Debt |
| 329.34K | -571.00K | -1.22M | 11.70M | 329.34K | 775.84K | Total Liabilities |
| 1.83M | 5.57M | 4.84M | 29.82M | 3.10M | 1.88M | Stockholders Equity |
| -3.14M | 778.00K | 6.25M | -20.55M | -4.42M | -2.61M |
| Cash Flow | Free Cash Flow | ||||
| -8.60M | -12.54M | -12.87M | -4.39M | -167.36K | -235.20K | Operating Cash Flow |
| -8.33M | -12.18M | -12.03M | -4.29M | -167.36K | -235.20K | Investing Cash Flow |
| -8.41M | 6.14M | -2.88M | -4.50M | 0.00 | 64.49K | Financing Cash Flow |
| 17.75M | 6.30M | 14.11M | 11.47M | 254.80K | 321.31K |
Tenon Medical, Inc. Technical Analysis
Neutral
1.25
Price Trends
1.61
Negative
2.22
Negative
3.53
Negative
Market Momentum
-0.08
Negative
53.79
Neutral
46.00
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TNON, the sentiment is Neutral. The current price of 1.25 is below the 20-day moving average (MA) of 1.38, below the 50-day MA of 1.61, and below the 200-day MA of 3.53, indicating a neutral trend. The MACD of -0.08 indicates Negative momentum. The RSI at 53.79 is Neutral, neither overbought nor oversold. The STOCH value of 46.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TNON.
Tenon Medical, Inc. Risk Analysis
Tenon Medical, Inc. disclosed 61 risk factors in its most recent earnings report. Tenon Medical, Inc. 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
Tenon Medical, Inc. Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $119.64B | 28.51 | 8.42% | 2.97% | 2.72% | 4.48% | |
72 Outperform | $22.03B | 24.36 | 7.24% | 0.87% | 3.84% | -9.29% | |
68 Neutral | $12.07B | 101.37 | 2.52% | ― | 60.62% | -35.88% | |
68 Neutral | $654.84M | ― | -18.38% | ― | 20.37% | 34.10% | |
49 Neutral | $653.24M | ― | -22.87% | ― | 7.08% | 20.45% | |
49 Neutral | $6.90B | -0.08 | -53.01% | 2.43% | 24.84% | -3.06% | |
43 Neutral | $3.92M | ― | -256.26% | ― | 38.30% | 86.56% |
* Healthcare Sector Average
Performance Comparison
TNON
Tenon Medical, Inc.
1.51
-10.09
-86.98%
MDT
Medtronic
93.28
10.37
12.51%
OFIX
Orthofix
17.10
3.05
21.71%
ZBH
Zimmer Biomet Holdings
107.34
-19.78
-15.56%
GMED
Globus Medical
73.49
18.20
32.92%
SIBN
SI-Bone
15.38
-1.92
-11.10%
Tenon Medical, Inc. Earnings Call Summary
Earnings Call Date: Nov 13, 2024 | % Change Since: -62.12% | Next Earnings Date: Mar 20, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant year-over-year growth, improved gross margins, and strong financial positioning due to successful investments. The introduction of the new Catamaran SE and positive clinical data further underscore potential for future growth. However, the company faced a revenue decline in Q3 due to reimbursement challenges and continues to operate at a loss. Overall, the sentiment is cautiously optimistic with strong growth potential overshadowed by short-term challenges.Highlights
Year-over-Year Revenue Growth
Revenue increased by 18% year-over-year, driven by a 5% rise in surgical procedures utilizing the Catamaran System.
Gross Margin Improvement
Gross margin improved by 2,200 basis points, reaching 54% for the first nine months of 2024 compared to 32% in the same period of the previous year.
Successful Investment and Financial Position
Received an investment from a healthcare-focused institutional investor, along with additional equity financings, resulting in net proceeds of approximately $9.6 million, fortifying the balance sheet.
Launch of Catamaran SE
Initiated prelaunch clinical work of the new Catamaran SE, with positive feedback from physicians and a planned full commercial launch in early 2025.
Positive Clinical Data
Interim analysis showed statistically significant reduction in SI joint pain and disability, with high patient satisfaction and a robust safety profile.
New Patents Issued
Received three new patents related to the Catamaran prosthesis, strengthening the competitive position.
Lowlights
Revenue Decline in Q3
Revenue declined by 6% compared to the prior year quarter and 1.6% compared to Q2 2024, primarily due to unexpected reimbursement pre-authorization issues.
Operating Loss
Net loss was $3.2 million for Q3 2024, with an expectation of continued losses in the future.
Reimbursement Challenges
Faced unexpected reimbursement pre-authorization headwinds, attributed to coding confusion, which are expected to improve with future coding clarity.
Company Guidance
During the third quarter earnings call for Tenon Medical, several key metrics were discussed. The company reported a 6% decline in revenue for the quarter compared to the prior year, amounting to $887,000, while revenue for the first nine months of 2024 increased by 18% year-over-year to $2.5 million. Gross margin improved significantly to 54% for the first nine months, up from 32% in the same period the previous year. Despite a restructuring of sales operations that led to a decrease in operating expenses, the net loss for the quarter was $3.2 million, slightly improved from a $3.3 million loss in the third quarter of 2023. The company also highlighted the receipt of approximately $9.6 million in net proceeds from investments during the quarter, which will be used to expand their sales force and advance product development. Looking ahead, Tenon Medical anticipates continued revenue growth and market share gains, bolstered by their recent clinical data and upcoming product launches.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.