Second Sight Medical Products (EYES) shares rise 1,000%. Should I buy?

first_imgSecond Sight Medical Products (EYES) shares rise 1,000%. Should I buy? Jonathan Smith | Wednesday, 10th March, 2021 | More on: EYES jonathansmith1 has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Image source: Getty Images Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! Our 6 ‘Best Buys Now’ Shares I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool.center_img In the slightly crazy space that global stock markets have become over recent months, I’ve seen some large moves. The GameStop saga is one of the most prolific cases, where retail investors drove the stock up incredibly quickly in a matter of days. Another case has been getting a lot of attention over the past couple of weeks. This is Second Sight Medical Products (NASDAQ:EYES). The stock is up almost 1,000% since the start of March, and 300% over the past year. What’s the story?Second Sight Medical Products is a US-based company that makes and sells unique implantable visual prosthetics for blind people. The business has been around for a while, having been founded in 1998. From looking at the share price over the past few years, it looked like the best days for EYES shares were in the past. EYES shares traded above $100 a share back in 2015, before trending down over recent years.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Losses started to stack up at the business. In 2017 the net loss was $28.5m, and in 2018 this rose to $35.1m. The treatment is expensive (revenue per implant is over $100k) and the cost of operations are high. As a result, EYES shares became heavily shorted. This means that investors thought the share price would fall further. They would profit by shorting the shares and buying them back at a lower price.The move higher only really started a few weeks ago, driven by company news and a reduction in short-selling. Firstly, speculation of upcoming FDA approval for the firm’s Argus 2s Retinal Prosthesis System gained interest. This saw EYES shares rallying, causing short-sellers to cut down their positions. By closing out a short position, they have to buy back the stock, which compounds the move higher.At the start of this month, confirmation of the FDA approval came out, seeing the share price explode higher.Do EYES shares have further to run?So will EYES share continue to rise. I think they will. The percentage return looks high, but that’s because it started from a low price to begin with. As of close yesterday, it was trading just below $16. So there’s still plenty of room to go even before it reaches the levels it was traded at back in 2015 (above $100).But I’m not looking at it because of some crazy share price movements. Company fundamentals matter to me.Basic earnings per share are still negative, but becoming less so. Q3 2020 EPS was -$0.07, up from Q2’s -$0.15 and Q1’s -$0.57. If we see this trend get back into positive territory, I think it could attract more longer-term investors. I acknowledge at the moment a lot of buyers are using EYES shares for speculation, but this could change if the fundamentals of the business continue to improve.The risk with EYES shares is the gulf between getting approval for a product and making the product commercially successful. There’s no guarantee that the Argus System will be a huge revenue generator for the company. All things considered, I do think EYES shares have potential but wouldn’t buy right now. I’d wait to see how the business progresses in coming months after the buzz has died down before looking to buy. Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. “This Stock Could Be Like Buying Amazon in 1997” Enter Your Email Address Simply click below to discover how you can take advantage of this. See all posts by Jonathan Smithlast_img

Leave a Reply

Your email address will not be published. Required fields are marked *