NVCR - This Promising Healthcare Stock Is Down 50% From Its Highs; Should You Buy the Dip?
Novocure (NASDAQ: NVCR) is the producer of a cancer-fighting wearable device called Optune. Its tumor-treating technology uses low-power electrical fields to interfere with a cancer cell's ability to multiply. The stock skyrocketed 40% in a single day back in April on positive news for Optune in tests for non-small cell lung cancer (NSCLC), but shares have fallen 40% since their June highs. Is now the time to reexamine this $14.5 billion oncology med-tech?
A recent slowdown in Optune sales spooked investors earlier this summer as the company reported an annual increase of only 6% in active patients at the end of June. Although the average reimbursement price improved by more than $400 per patient per month in the second quarter versus the same period last year, the company only saw a 15% year-over-year increase in net revenue for its wearable technology in the most recent quarter .
And with that, it seems Optune's low-hanging fruit has disappeared. It's not surprising, as Optune received its first approval for a certain type of brain cancer called glioblastoma in 2011, and since then has only added a rare form of lung cancer, called mesothelioma, to its approval list.
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This Promising Healthcare Stock Is Down 50% From Its Highs; Should You Buy the Dip?