It's Not Too Late to Profit on TearLab
It is clear TheStreet's Jim Cramer fits into that category. After seeing the 33% surge in shares of TearLab>
While the med-tech space is not exactly new to me, for several reasons TearLab had fallen off my radar. But after Cramer's comments and the stock's immediate jump, the company's got my attention. Investors want to know if it's too late to profit.
Take a look at the chart below.
Courtesy of Yahoo! Finance
Over the past 12 months TEAR has been on a "tear," gaining as much as 345%. Given the company's strong fiscal first-quarter results (reported in May), there are no meaningful signs of slowing down. For those who are unfamiliar with this company; TEAR manufactures an industry-leading lab-on-a-stick system that helps in the diagnosis of dry-eye disease.
In the U.S. alone, dry-eye disease affects roughly 40 million people, according to published reports. Unfortunately, of the many people that are diagnosed, less than 5% receive the necessary treatment because the test requires a tear sample that patients are unable to submit. With TearLab's system, doctors are able to make out the disease with a smaller quantity of tears needed.
As the chart above shows, investors have been crying tears of joy over TearLab's revolutionary system for the past twelve months. But it hasn't always been this easy. There was a point when TearLab's stock performance was the punch-line to many jokes as the company was teetering on the verge of bankruptcy.
The near-death experience makes this situation all the more interesting. Truth be told, this company is not that different from what it was a year ago. Yet, in the recent quarter revenue was up close 486% year-over year. This is an eye-popping performance, if you will pardon the pun. As stunning as this number is, it also makes me nervous, given the 345% run that the stock has already experienced.