Six Reasons I Couldn’t Be More Pleased by Our First EKSO Update
One of the great things about Total Wealth is that we’re going to have the opportunity to revisit everything from our trends to our tactics and even the companies I recommend – beginning today.
There’s a lot happening with Ekso Bionics Inc. (OTC:EKSO), our “Human Augmentation” frontrunner. And I’d like to bring you up to speed on the latest developments.
First, the fact that a lot is happening is, in and of itself, a great thing.
Over the years I’ve seen a lot of potentially great companies get off to a good start, but then fall flat because “nothing happened.” These companies don’t set out to fail; it’s just that they haven’t got the management, the funding, and, most importantly, the client base needed to succeed.
Ekso, on the other hand, has all three, which means the company is moving forward.
You’ve got to see what else they’ve been up to…
Second, the company was recently profiled in Forbes, which in its article here chose to highlight the DARPA-funded military side of human augmentation rather than the medical aspects we’ve emphasized. No doubt Tony Stark of “Ironman” fame would have loved it.
Image courtesy of Forbes.com
Third, the company recently received its first National Institute of Health (NIH) grant to develop an exoskeleton for injured children in conjunction with Oakland’s UCSF Benioff Children’s Hospital. This is very significant because it will be proof positive that the technology is as scalable and transferrable as I’ve suggested it will be.
Fourth, the company was recently profiled on none other than one of my favorite shows, Varney & Co. on the Fox Business Network (click here to watch the clip). Obviously, I’m a little biased considering how fortunate I’ve been to be a part of Stuart Varney’s “Company” for years, but that doesn’t change the fact that Ekso appropriately received some fabulous national exposure at a time when the company’s rehabilitation efforts are taking off. It’s already sold, for example, more than 45 suits in the first nine months of this year, which is more than twice the total number of suits it sold in all of 2013. Meanwhile, SoldierSocks, a 501c(3) company that works with veterans, has established the goal of buying 80 Ekso suits in the next 36 months for veterans, hospitals serving veterans, and other similar health facilities.
Fifth, the company will be proactively filing with the FDA this quarter so that Ekso suits will receive marketing clearance under an entirely new “Powered Exoskeleton” classification rather than just the current Class I designation it holds today. This is really powerful. It could open up an entirely new marketing capacity. In effect, what this suggests is that Ekso is so innovative, the FDA has to create an entirely new category just to keep up.
And sixth, Ekso just announced a new licensing agreement with Ottobock, the largest manufacturer of prosthetics in the world. They’ll license their patented technology to Ottobock in exchange for royalty payments. That’s another stream of income for Ekso I’m glad to see.
So now what?
Here’s What’s Next for EKSO
The company has recently filed an 8-K with the SEC in which it’s amending the terms of a prior offering to purchase common stock via warrants at $2 a share to $1 a share. That should result in net proceeds of $28.7 million, which is enough capital to carry operations through Q2/2015.
Normally I wouldn’t be crazy about something like this. Warrants tend to be a real drag on stock prices even though they are an important source of early stage funding. They have this depressing effect on stock prices because they create what in industry terms is known as “overhang,” which means that prices tend to migrate towards the exercise price for as long as the warrants are in effect.
But, again, we’re not talking about a “fly by night” organization here. I think what we’re going to see is a situation where the company’s potential begins to dramatically accelerate. I expect significant top-line growth as a result, followed by bottom-line results that will, in turn, translate to higher prices.
Simply put, Ekso has built up a solid head of steam and is tapping into what may be the ultimate “Unstoppable Trend” – human augmentation.
If you don’t already own Ekso, I think it’s quite simply the most inspiring tech investment you can make today. By 2020, I think this tiny company which is currently trading at around $1.35 will hit at least $20 a share. You simply don’t see this kind of potential very often.
(By the way, if Ekso’s price does fall short-term, that’s a killer buying opportunity. You should have your “lowball order” ready based on my original instructions to plan on adding to the stock over the next two months 25% at a time.)
A Potential New Play in Yet Another “Unstoppable Trend”
Speaking of explosive profit opportunities, I’ve been doing a lot of reading about something called the “Lazarus” phenomenon. That’s what it’s called when a patient’s heart starts beating again by itself, after attending physicians have given up hope. More than 50% of emergency room doctors have witnessed it, according to the official journal of the European Resuscitation Council.
And that’s got me thinking about work being done by Dr. Peter Rhee and his colleagues at the University of Arizona. They are doing groundbreaking work in a radical area of medicine that quite literally involves killing you as a last resort… in order to save your life later.
I don’t want to spill the beans on the company I’m researching in this area just yet, because it’s not quite ready for your investment dollars (not until we see early results). But what they’re doing is stunning.
This is an advance that could mark an ideal play for Medical Breakthroughs – another of our “Unstoppable Trends.”
Best regards for great investing,