Semler Scientific, Inc. NASDAQ: SMLR was one of November’s hottest stocks, rising more than 130% as investors rallied around newfound support for Bitcoin. The medical and healthcare equipment company recently made a splash by significantly expanding its bitcoin holdings and introducing “bitcoin yield” as a key performance indicator (KPI).
With Bitcoin hovering around the psychological $100,000 level, SMLR has become a speculative favorite, joining the ranks of crypto stocks like MicroStrategy. NASDAQ: MSTR and MARA Holdings NASDAQ: MARA. But does SMLR represent a legitimate Bitcoin play or is this momentum short-lived?
What is Semler scientific?
Semler Scientific today
Semler Scientific
(As of 11/27/2024 6:15 PM ET)
- 52 week range
- $20.88
▼
$79.45
- P/E ratio
- 29.78
While the company has attracted attention for its bitcoin purchases, Semler’s roots lie in healthcare, not cryptocurrency. Semler specializes in providing technology solutions to improve the clinical performance of healthcare professionals in the United States.
Its flagship product, QuantaFlo, is a four-minute in-office blood flow test used to assess patients’ vascular health. This diagnostic tool is an essential tool for healthcare professionals seeking to improve early detection of vascular disease. In addition, Semler offers Insulin Insights, a software platform that helps optimize insulin dosing in the outpatient setting. Despite the recent pivot to Bitcoin, Semler’s core business remains firmly tied to the healthcare sector.
Semler’s Big Bitcoin Bet
In November, Semler made headlines by significantly increasing his bitcoin holdings as part of his treasury strategy. The company purchased 215 bitcoins for $17.7 million, bringing its total holdings to 1,273 bitcoins purchased at an average price of nearly $69,700. The recent purchase was partially funded through a public offering that raised $21.5 million through the sale of 505,544 shares.
This bold move positions Semler as a company aggressively using capital to expand its Bitcoin portfolio. While it’s not a pure-play cryptocurrency stock like MicroStrategy, its growing Bitcoin holdings have caught the attention of investors, making it a unique hybrid of healthcare and digital assets.
Bitcoin’s Impact on Semler’s Earnings
Semler’s Bitcoin holdings played a significant role in its third-quarter earnings, helping the company beat expectations despite challenges in its core business. The company reported diluted earnings per share of 72 cents, well above estimates of 48 cents. The outperformance was primarily due to unrealized Bitcoin gains of $1.1 million and cost-cutting measures.
However, core operating results paint a less optimistic picture. Revenue fell to $13.5 million in the third quarter from $16.3 million in the same period last year. Revenue at QuantaFlo, the company’s flagship product, declined, reflecting difficulties in expanding the market and retaining customers.
A company’s move to Bitcoin could be the answer to these obstacles. By adopting a bitcoin-focused strategy, Semler is seeking to diversify its earnings and attract investor interest, but it is unclear whether this approach can offset problems in its core business.
The Balancing Act: Potential Benefits and Risks
Semler Scientific Stock Forecast Today
$0.00
-100.00% MinusStrong Buy
Based on 1 analyst estimates
| High forecast | $0.00 |
|---|---|
| Average forecast | $0.00 |
| Low forecast | US$10,000,000.00 |
Semler Scientific Reserve Forecast Details
Semler’s adoption of Bitcoin presents both opportunities and risks. On the one hand, the company’s Bitcoin assets significantly increased investor sentiment and caused speculative excitement. With Bitcoin trading near all-time highs, further gains in cryptocurrency prices could lead to additional upside potential for Semler.
On the other hand, Bitcoin’s volatility poses a significant risk. A significant downturn in the cryptocurrency markets could negatively impact the company. profit, especially given the unrealized gains that bolstered its recent results. In addition, Semler’s core business faces ongoing challenges from declining revenues and limited expansion of its customer base.
Coverage of the stock is also limited, with only one analyst providing ratings. The lack of wider institutional attention may limit its appeal to more risk-averse investors.
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