Investors have kicked off the week on a cautious note as they wait for the U.S. Federal Reserve Chair Janet Yellen to deliver her speech in Jackson Hole, Wyoming later this week. Yellen will be speaking at the annual symposium of central banks.
The speech will be closely watched as investors try to determine when the Fed will hike benchmark interest rates. Following the first rate hike in a decade in December last year, the Fed has been dovish due to some softness in the U.S. economy and global economic factors.
However, the last two reports from the labor market have been quite strong and some Fed officials have hinted at a rate hike later this year. It will be interesting to see if the Fed Chair is also in the rate hike camp.
A rate hike would be negative for risk assets such as equities and hence the cautiousness among investors. Remember that in terms of fundamentals, equities are looking overvalued. The rally has been extended by the excess global liquidity due to monetary easing from central banks.
Although investors are on the sidelines today, there are some major movers. One such mover is Zynex Inc. (OTCQB:ZYXI). Based in Lone Tree, Colorado, Zynex conducts its business through its subsidiaries and the operating subsidiary is Zynex Medical, Inc. (ZMI).
Its other subsidiaries include Zynex Monitoring Solutions, Inc. (ZMS) and Zynex Europe, ApS (ZEU). ZMI designs, manufactures and markets medical devices that treat chronic and acute pain, as well as activate and exercise muscles for rehabilitative purposes with electrical stimulation.
ZYXI shares are soaring after the company announced its financial results for the second quarter. For the quarter, ZYXI reported net revenue of approximately $3.29 million, up from $3.07 million reported for the same period in the previous year. The company’s gross profit margin for the quarter was 71%.
ZYXI reported a net loss of $227,000 for the quarter, compared to a net loss of $501,000 reported for the same period in the previous year. The company’s cash from operations in the first half of 2016 totaled $953,000, compared to negative $194,000 in the first half of 2015.
At the end of the quarter, Zynex’s line of credit balance totaled $3.29 million.
At last check, ZYXI shares were trading 74% higher at $0.3099 on volume of 7,760, which is more than three times the daily average volume of 2,000. With today’s share price surge, shares are trading near their 52-week mid-way point. Time will tell if today’s strong move has staying power, or if the bears enter the picture again and push shares lower again.
