This tech company is a new IPO, whose shares are gliding back toward a buy-in price. As newly-public companies may be more volatile than their peers, please be sure to make them a small portion of your overall portfolio.
ReWalk Robotics (RWLK)
from New Technology Superstars
ReWalk Robotics (RWLK) makes robotic walking systems, or exoskeletons, that enhance the lifestyle of paraplegics who have suffered spinal cord injuries. Its founder, Dr. Amit Goffer, started the company in 2001 for a very personal reason. He is quadriplegic.
Goffer started with a small research team in Israel, and has since grown the company enough to take it public on Wall Street earlier this month with a near $50 million offering priced at $12. That valued the company at a $170 million market capitalization. Shares of RWLK then surged as high as $44 before falling almost by half to $25 before rebounding. There’s a buying opportunity nearby.
The company is early stage, with small sales and high losses as it burns R&D cash to design, develop, and bring to market its exoskeletons packed with computers, tilt sensors, motion sensors, and motors. There are two versions. ReWalk Personal for everyday use by individuals. And ReWalk Rehabilitation for use in clinics to provide therapy and exercise to patients.
Similar to the way a Segway scooter works, the ReWalk exosuits rely on subtle shifts in the user’s center of gravity for control. Sitting, standing, turning, and climbing and descending stairs are all possible. Published clinical studies show the system can replicate a natural gait and walking speed—something competing platforms haven’t been able to deliver. The U.S. military is very interested in the way such suits can help crippled soldiers now, and enhance future soldiers later.
According to the Spinal Cord Injury Statistical Center, there are 273,000 people in the U.S. with spinal cord injuries with roughly 12,000 new cases per year. Of these, approximately 42,000 are veterans. With 24 spinal cord facilities in the VA system, the largest single network of spinal cord injury care in the country, RWLK has a big opportunity in getting soldiers back on their feet. Multiple sclerosis is another market, which 400,000 Americans suffering from the disease. Of these, the company estimates that roughly 212,000 need walking assistance.
Let’s set up to buy a breakdown back near the original IPO level for now, as collapses to that level are nearly always bought at least once. And if instead it stabilizes and moves higher, particularly after its first earnings report, then we can raise our bid dramatically later.
ReWalk Robotics Ltd. (RWLK): Buy a 2.5% allocation at a limit order of $26.00 This order is good-till-cancelled. If filled, set a target of $40.00.
Jon Markman, New Technology Superstars, published by Money and Markets, a Division of Weiss Research, Inc., www.moneyandmarkets.com/services/trading-services/new-technology-superstars, issues@e.moneyandmarkets.com; 1-800-291-8545, September 23, 2014