Second Sight Medical Products, Inc.

EYES Details

Resumed Early Feasibility Study of the Orion: Second Sight Medical Products, Inc. (NASDAQ: EYES) develops and sells implantable visual prosthetics that deliver a useful artificial vision to blind individuals. As on 22 December 2020, the market capitalization of the company stood at ~$64.96 million. Earlier due to the ongoing pandemic, the company had paused its various investigations and studies as medical centers were being used for COVID-19 responses. In September 2020, the company resumed its Early Feasibility Study of the Orion^® Visual Cortical Prosthesis System (Orion) at UCLA Medical Center (UCLA). Notably, Orion is a breakthrough technology that is focused on providing useful artificial vision to individuals who are blind due to a wide range of causes, including glaucoma, optic nerve injury, diabetic retinopathy, and eye injury.

YTD September 2020 Highlights: In the first nine months of 2020, the company has reported no net sales as compared to $2.9 million in the same period in 2019. Moreover, the company has decreased its research and development expenditure by 50% to $4.5 million in the first nine months of 2020, as compared to $9.0 million in pcp. As on 30 September 2020, the company’s cash and cash equivalent stood at $2.4 million, down from $11.3 million as of 31 December 2019.

Q3 FY20 Results (Source: Company Reports)

Outlook: Looking ahead, the company does not expect to earn revenues until it is successful in completing the development and obtaining marketing approval for Orion. Moreover, it expects its expenses to increase as it continues the clinical trials of Orion, initiate new research and development projects, and seek marketing approval for its product candidates.

Stock Recommendation: Over the last one-month period, the stock of EYES has provided a return of 234.92%. However, the stock is trading lower than the average of its 52-week price band. On the technical analysis front, the stock has a support level of ~$1.32 and resistance of ~$4.84. In its Q3FY20 results, the company has admitted that it does not have sufficient funds to support its operations for the next 12 months. Based on the aforesaid facts, the significant rise in the stock price over the last one month, COVID-19 led uncertainties, decline in the cash balance, and expected rise in the company’s expenses, we suggest investors to avoid the stock at the closing price of $2.81, up by 37.75% as on 22 December 2020.

EYES Daily Technical Chart (Source: Refinitiv, Thomson Reuters)

Arcimoto, Inc.

FUV Details

Announces Customer Reservations in Florida: Arcimoto, Inc. (NASDAQ: FUV) is mainly involved in the development and manufacturing of ultra-efficient and affordable electric vehicles. As on 22 December 2020, the company’s market capitalization stood at ~$511.25 million. The company recently announced the launch of customer delivering to Florida, in line with its nationwide expansion plan. FUV has started reaching out to early pre-order customers to reserve the FUV® or the upcoming Arcimoto Roadster. It expects the deliveries to begin in Q1 2021.

Q3FY20 Result Highlights: For Q3FY20, the company reported revenue of $683,895, up from $33,311 reported in the previous corresponding period (pcp), mainly due to resumption of vehicle production and customer deliveries. Notably, the company delivered 31 vehicles in the month of September alone. During the quarter, the company launched multiple high-visibility pilot programs for its vehicles, and advanced long-term growth and development programs in every department of the company. For the quarter, the company reported a net loss of $4.6 million. As at 30 September 2020, the company had cash and cash equivalent of $17 million, significantly higher than $5.8 million as on 31 December 2019.

Q3FY20 Results (Source: Company Reports)

Outlook: Looking ahead, the company is focused on expanding to nationwide delivery in 2021 and scaling to mass production in 2023. In Q4FY20, the company expects the deliveries to exceed the sum of total deliveries in the previous two quarters.

Stock Recommendation: Over the last three months, the stock has provided a return of 125.9%. It is currently inclined towards its 52-weeks’ high price of $20.20. On the technical analysis front, the stock has a support level of ~$13.99 and resistance of ~$16.19. On a TTM basis, the stock has a Price to Book multiple of 17.9x, higher than the industry average (Automobiles & Auto Parts) of 4.3x. Considering the aforesaid facts, steep rise in the stock price over the last three months, and current trading levels, we suggest investors to wait for a better entry level and give an “Expensive” rating on the stock at the closing price of $15.00, up by 6.61% as on 22 December 2020.

FUV Daily Technical Chart (Source: Refinitiv, Thomson Reuters)

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