Investors in Israeli-based Mazor Robotics (NASDAQ: MZOR) had to stomach a greater than 15% plunge in June, according to data from S&P Global Market Intelligence.
The decline was primarily caused by the news that the Israeli Securities Authority had conducted a search at the company's headquarters. Investors also learned that the agency had also performed a question and answer session with some of the company's officers.
While management stressed that Mazor has not been charged with any wrongdoing and that it is fully cooperating with the agency, the surprise news caught traders off-guard. In addition, a number of law firms announced their intention to look into the matter on behalf of investors to see if Mazor's management team had misled the public in some way.
Given the negative news flow, it isn't hard to figure out why traders knocked down the company's share price in June.
Mazor's CEO Ori Hadomi did his best to calm the market's fears during his presentation at the Jefferies 2017 Global Healthcare Conference mid-month. He reasserted that the company has not been charged by the agency and that it made the announcement in an effort to be as transparent as possible with investors.
Thankfully, the markets appear to be looking past this issue after the company pre-announced its second quarter results. Investors learned that Mazor expects to report record revenue of about $15.4 million in the quarter, which represents growth of more than 85% year-over-year. In addition, the company reported that it sold 19 systems during the period. That helps to reaffirm that its partnership with Medtronic is paying off.
All in all, Mazor's continued success with system sales continue to prove that the bull case for owning its stock remains intact. For that reason, I'm personally content to hang on to my shares for the foreseeable future.