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Why Zynex Stock Is Up Today

By Prosper Junior Bakiny – Jul 10, 2020 at 12:46PM

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The company expects strong second-quarter financial results.

What happened

Shares of Zynex (ZYXI 3.55%), a medical devices manufacturer, are up by 12.1% as of 12:22 p.m. EDT on Friday, after the company announced on Thursday that it had experienced an increase in orders during the second quarter. As a result, Zynex revised its second-quarter and full-year revenue guidance. 

So what

The demand for some of Zynex's medical devices -- which include devices for pain management and cardiac monitoring -- grew during the second quarter as many states started relaxing social distancing measures and reopening their economies. Specifically, the company said that it experienced a 37% increase in orders compared to the year-ago period. What's more, Zynex expects that trend to continue during the third quarter. The company had previously said that its revenue for the second quarter would come in between $17.5 million and $18 million. 

Five upward pointing arrows drawn on a blackboard.

Image source: Getty Images.

Now Zynex expects its top line to be in the range of $18.9 million to $19.4 million. Note that on average, analysts expect the company's revenue to be $17.98 million for the quarter. Further, Zynex increased its full-year revenue estimates to between $80 million and $85 million, up from between $78 million and $83 million. This would represent revenue growth of between 76% and 87% over fiscal 2019.

Now what

Zynex has been performing well all year long, even as many other medical device companies have struggled amid the ongoing outbreak: The company's stock is up by 267.5% year to date. Given its latest business update, the healthcare company will likely continue on its upward trajectory at least until the end of the year. 

Prosper Junior Bakiny has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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