When I wrote my very first piece for Seeking Alpha about the Israeli nano-cap medical technology company ReWalk (RWLK) back in March 2016, I was addressing the introduction of more competition into the space for its only product at the time, an exoskeleton suit used primary to assist those with spinal cord injury be able to walk again. Specifically, at that time Parker Hannafin (PF) was bringing out its similar product, the Indego.
(image source: here)
Now just over three years on from that writing, looking back, there's no particular evidence that ReWalk has suffered as a result of any additional particular competition. However, the market three years ago was still just in its infancy, and Parker Hannafin coming in has probably helped create more of a market. Taking a look now, after ReWalk has released its Q2 2019 results, should help shed some light on where the company is headed going into 2020.
A Quick Summary of Q2 2019
ReWalk Q2 '19 results were released in early August, and on the surface, to say they were "underwhelming" would be too generous. Primarily, the top line looked atrocious, with revenue of less than $1 million for the quarter at $0.9 million. This is a low level it hasn't breached in years, with an average quarterly revenue over the last few years in the $1.7 million range, and this whopper of a miss came without warning.
However, it did come with some explanation, primarily that a good deal of sales were pushed into July. On the earnings call, CEO Larry Jasinski stated that within the first five weeks of Q3, $900,000 in orders had been received, and $700,000 delivered, so the explanation appears valid. If there was much of a silver lining, it would be that even on sharply-reduced revenue, somehow gross margin went from 43% to 50%, which may
