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Is Nano-X a Buy?

By Taylor Carmichael - Mar 11, 2021 at 6:00AM

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This healthcare disrupter is about to receive FDA clearance to start distributing its new X-ray device.

Nano-X Imaging (NNOX 3.59%) hit the public markets last year at $20 a share. The stock quickly shot up to over $60, and then crashed back down to $24, then ran up to $86. Now the share price sits at $39. Is Nano-X a buy today? In this video clip from Motley Fool Live, recorded live on March 5, Corinne Cardina, bureau chief of healthcare and cannabis at Fool.com, and Motley Fool contributor Taylor Carmichael discuss the upside of Nano-X.

Corinne Cardina: Let's talk about Nano-X.

Taylor Carmichael: Okay.

Cardina: Could you tell us what that company is and maybe briefly one green flag and one red flag for this stock.

Carmichael: Nano-X is an Israeli company, they have a new kind of X-ray, which is amazing device. X-rays are kind of boring. They've been around for over a 100 years. They are very expensive devices, CAT scans, MRI devices that costs about a million, 2 million, 3 million dollars, hospitals buy them and they are expensive. You can wait a long time sometimes to get it scheduled. Nano-X has made a radical new discovery. What your traditional X-ray device, your MRI, your CAT scan needs to do to create the X-ray is to heat the machine up to, I might get this number wrong. It's over 1,000 degrees Fahrenheit, might be 2,000 degrees Fahrenheit. It is incredibly hot machine and then it has to cool it down, which is where all the expense is. What Nano-X has discovered is a way to do that using nanotechnology to create the X-ray without having to manufacture all this heat and cool the machine down. It's a far cheaper machine. It's a far cheaper X-ray machine, $10,000 instead of a million. That's a couple of degrees magnitude cheaper. I believe they're not only going to radically disrupt the market, they are also going to expand the market. You're going to see a lot more X-rays. It's also a software-as-a-service company because what I love about this company, they're going to get paid every time it's used. They are basically going to give the machine away for $10,000 or less, but every time it's used, they're going to take a slice off of every X-ray, and they've got that huge recurring revenue model, which is brilliant for Intuitive Surgical investors or investors who love that razor/blades model. But that's a wonderful thing. I'm very excited about Nano-X. The device is not on the market yet. They're waiting for FDA, approval is not the word, what's the other word that we say?

Cardina: Clearance for the device.

Carmichael: Clearance, they're waiting for clearance and they should have it within a month.

Cardina: Awesome, and they just reported earnings. It was very impressive. I don't want to go into it, so we have time to go to the next one, but take a look.

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