TherapeuticsMD Inc. (TXMD - Get Rating) is a pharmaceutical business that makes both generic and branded prescription products. The entirety of TXMD’s products is geared toward women. In particular, TXMD has been in the news to develop several hormone replacement solutions that mitigate both the health risks and symptoms from hormonal deficiencies stemming from menopause.

Based in Boca Raton, Florida, TXMD dipped in the past month, falling from just under $1.40 to its current price of $1.16. However, TXMD was priced at $2.55 on February 9. The stock quickly descended to $1.30 by early March, jumped to $1.66 by the middle of the month, and has since tailed off.

It is particularly interesting to note TXMD has been in business for more than a century yet is a penny stock. However, this has not always been the case. TXMD was priced as high as $155 in the late aughts. The stock dropped below $5 in 2011, qualifying as a penny stock. TXMD has traded around $8 or less in the decade since.

TXMD Points of Note

TXMD’s fourth-quarter earnings were better than expected even though the company reported a loss for the period. TXMD topped analysts’ estimates for revenue. The company posted a quarterly loss of 15 cents per share. Analysts anticipated a loss of 10 cents per share. TXMD posted a loss of 19 cents per share in the same quarter one year ago. However, TXMD has beaten consensus estimates only one time in the past four financial quarters.

All in all, TXMD’s fourth-quarter revenue was $22.58 million. The company’s revenue in the same period one year ago was just under $16 million. TXMD had beaten the consensus estimates for revenue three out of the prior four financial quarters.

There is the potential for TXMD to eventually be delisted, meaning it will no longer be available for trading on the Nasdaq. If this penny stock remains a penny stock for several more months and is ultimately delisted, it will prove quite challenging to raise capital. It must be noted that TXMD was hit with a fine of $400,000 over the summer for failing to provide full disclosure to current and prospective investors.

TXMD According to Analysts 

Analysts think quite highly of TXMD, setting an average target price of $6.17. If TXMD rises to this level, it will have soared an incredible 431.9%. The highest analyst target price for the stock is an eye-popping $10, but its lowest is $3. Of the six analysts who have issued recommendations for the stock, two consider it a Strong Buy, and four consider it a Buy.

TXMD POWR Ratings

TXMD has an overall grade of D, translating into a Sell rating in our POWR Rating service. It has C grades in the Value and Growth components of the POWR Ratings. TXMD has grades of D in the Momentum and Quality components. Investors who are curious as to how TXMD fares in the Sentiment and Stability components can find out by clicking here.

Of the 232 publicly traded companies in the Medical – Pharmaceuticals industry, TXMD is ranked 167th. Investors can find top-rated stocks in the industry by clicking here.

Is TXMD Deserving of a Place in Your Portfolio?

TXMD certainly has potential, but it’s not a Buy at the moment. Let’s consider the POWR Ratings first. Our ratings system considers 118 factors before assigning a rating. Stocks that have a Buy or Strong Buy have a higher chance of outperforming, while stocks with a Sell or Strong Sell rating have a higher chance of underperforming. With a Sell rating, TXMD should definitely be avoided. While the company is well-liked by analysts, its earnings misses and potential delisting are quite worrisome.

TXMD shares were trading at $1.14 per share on Thursday morning, down $0.02 (-1.81%). Year-to-date, TXMD has declined -5.79%, versus a 12.50% rise in the benchmark S&P 500 index during the same period.

About the Author: Patrick Ryan

Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management. More...

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