NVRO - Embedded Expectations Analysis - 2021 10 08
Nevro Corp. (NVRO:USA) currently trades at a significant premium to UAFRS-based (Uniform) assets, with a 10.9x Uniform P/B. At these levels, the market is pricing in bullish expectations for the firm, but management may have concerns about overall procedural volume recovery, their market share trends, and their new PDN treatment.Specifically, management may have concerns about the pace of procedural volume recovery, their sustainability of their SCS leadership position, and competitive pressures. Furthermore, they may be exaggerating the favorable market response to their PDN product, and they may have concerns about the pace of the associated revenue ramp. They may also lack confidence in their ability to manage operating expenses and meet revenue and adjusted EBITDA guidance. Moreover, management may be downplaying concerns about market share, and they may lack confidence in their ability to further invest in new therapies and patient populations. Finally, management may have concerns about the progress of the approval process for their FDA claim to officially label the PMA supplement as a treatment for NSRBP patients.
Nevro is a medical device company that has developed and commercialized the Senza? spinal cord stimulation, a neuromodulation platform for the treatment of chronic pain. The Senza system is approved to create electrical impulses from two Hz to 10,000 Hz, including the company's proprietary HF10 therapy, which allows for pain relief without paresthesia. Senza is consisted of leads, a trial stimulator, an implantable pulse generator (IPG), surgical tools, a clinician laptop programmer, a patient remote control and a mobile charger. These components enable physicians to implant the leads and the IPG, and patients to operate the system.
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