Neonode (NASDAQ: NEON) stock price has crashed to a record low as the company continues facing numerous headwinds. The stock was sitting at $1.1 on Thursday, close to its all-time low. At the same time, the shares have plunged by more than 91% from the highest point on record. This gives it a market cap of more than $20 million.
Advanced technology, weak financialsNeonode is a small company that builds some of the most advanced products. It has created advanced optical sensing solutions for contactless touch, touch, and gesture sensing. It sells this hardware and software to companies in the United States and other companies.
While Neonode has advanced technology, it has not been able to monetize it well. For example, its revenue in 2018 was over $8.5 million followed by $6.6 million, $6.0 million, $5.8 million, and $5.7 million in the next years.
Along the way, the company’s net losses have jumped. Its net loss was over $3.9 million in 2018 and over $25 million in the next four financial years. This makes it a cash incinerator. While its total cash has increased from $6.6 million in 2018 to over $14.8 million, it happened as the total outstanding shares jump.
Neonode published mixed financial results. The company’s total revenue came in at $1.2 million in the third quarter. This revenue dropped by 5% from the same period in 2022. Revenue from licensing rose by 15% to over $1.1 million. Its net cash burn for the period was over $600k. The CEO said:
“Product sales revenues were low and clearly below targets and also below expectations I can admit. Overall, weaker customer demand but also in some cases.”
So, is Neonode a good stock to invest in? I believe that Neonode has advanced tools and patents. It has hundreds of patents that can be adopted by companies in the industry. The challenge for Neonode is that the company has struggled to monetize its products. It has had sluggish revenue growth over the years, making it a bad investment for now.
Neonode stock price forecast
The weekly chart shows that the Neonode share price has not done well in the past few months. After peaking at $14.74 in January, it crashed to a low of $1.31, the lowest level since December 2019. The shares crashed to a low of $3.29, the lowest point on August 29th.
Further, the stock has plunged below the 50-day and 100-day Exponential Moving Averages. The Relative Strength Index (RSI) has plunged below the oversold level. Therefore, the outlook for the stock is bearish, with the next key level to watch being at $1. A move below that level will see it fall to the next support at $0.50.
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