Medical Device Stock Leaping Higher as ASX Market Crashes

August 22, 2024
12:04 am
Stock Piper Team

The Australian Stock Exchange (ASX) has been a rollercoaster of late, with the S&P/ASX 200 Index performing positively despite the broader market's turbulence. As of August 6, 2024, the index stands at 7,680.6 points, a 0.41% increase from its previous close. Amid this mixed market performance, certain medical device stocks have shown remarkable resilience and growth, with OncoSil Medical Ltd. (ASX: OSL) and ResMed Inc. (ASX: RMD) leading the charge. These companies have managed to thrive even as other sectors face significant challenges.

OncoSil Medical Ltd (ASX: OSL)

OncoSil Medical Ltd., a prominent player in the medical device industry, has recently shown a positive performance in the ASX market. As of today, $OSL is trading at AUD 0.010 per share.

Financial Highlights

The company's latest Appendix 4C Quarterly Cash Flow report for the June 2024 quarter reveals a robust financial position. As of June 30, 2024, OncoSil had $4.509 million in cash and equivalents, marking a significant increase from $2.930 million at the end of March 2024. This increase is primarily attributed to a successful capital raise of $5.415 million during the quarter, with an additional $0.331 million committed in June and paid in July. Further boosting their financial stability, OncoSil announced an additional $2.7 million placement on July 25, 2024.

Despite the positive cash inflow, the company reported a net cash outflow of $3.366 million in operating activities, driven mainly by staff costs and direct research and development expenditures, which together accounted for over 65% of the total operating expenses. These expenditures are crucial for the company's ongoing efforts to commercialise its OncoSil™ device in various markets.

Operational Milestones

OncoSil Medical has also made significant strides in its operational endeavours:

Revenue Growth: The company reported $0.171 million in revenue for Q3 and Q4 combined, a substantial increase of 161% compared to Q1 and Q2 and 136% compared to the same period last year.
International Expansion: OncoSil treated its first commercial patients in Austria, and the first patient in Türkiye was treated with the OncoSil™ device.
Clinical Trials and Studies: The ongoing PANCOSIL Investigator Initiated Clinical Trial saw its fifth patient treated, highlighting the company's commitment to advancing its clinical research.
New Agreements: A three-year distribution agreement was signed for Saudi Arabia, expanding OncoSil's market reach.

ResMed Inc. (ASX: RMD)

ResMed Inc. is another noteworthy medical device stock that has demonstrated resilience amidst market volatility. However, it recently experienced a 3.52% drop in its stock price, closing at AUD 223.15 USD as of August 20, 2024. Despite this decline, ResMed's strong financial performance underscores its potential for future growth.

Financial Performance

ResMed delivered strong financial results for the fourth quarter of fiscal year 2024. Revenue climbed 9% year-over-year to $1.2 billion, while operating profit surged by 38%. The company generated a robust operating cash flow of $440 million, enabling it to reduce debt by $300 million. Earnings per share reached $1.98, with non-GAAP earnings per share at $2.08, demonstrating the company's solid financial performance.

Full-Year Highlights

For the full fiscal year 2024, ResMed's performance remained strong:

Revenue Growth: The company achieved an 11% increase in revenue, amounting to $4.7 billion.
Gross Margin: Gross margin improved by 90 basis points to 56.7%, with non-GAAP gross margin up 120 basis points to 57.7%.
Operating Income: Income from operations rose by 17%, with non-GAAP income from operations up 21%.
Earnings per Share: Diluted earnings per share were $6.92, with non-GAAP diluted earnings per share at $7.72.

The Stocks Leaping Higher as the ASX Market Crashed

In conclusion, despite the ASX market's overall turbulence, OncoSil Medical Ltd. and ResMed Inc. have managed to not only withstand the crash but also show significant growth and resilience. OncoSil's strategic financial manoeuvres and operational milestones have positioned it well for continued success. Similarly, ResMed's robust financial performance underscores its potential for sustained growth in the medical device sector. As the broader market faces challenges, these companies' ability to thrive highlights their strengths and investor appeal in these uncertain times.