Rockwell Medical-RMTI Stock Rises 138% in Q3: What Should You Do Ahead of Earnings?

Core Viewpoint - Rockwell Medical (RMTI) is expected to report strong third-quarter results, with significant growth in revenues and earnings driven by recent business developments and market positioning [3][4][5]. Financial Performance - The Zacks Consensus Estimate for third-quarter revenues is $25.9 million, indicating a year-over-year growth of 9.3% [3]. - The consensus estimate for third-quarter earnings is 1 cent per share, reflecting a 114.3% increase year-over-year [3]. - Adjusted earnings in the last reported quarter were 1 cent, surpassing the Zacks Consensus Estimate by 125% [3]. Business Developments - Recent announcements, including new product launches and distribution agreements, have positively influenced earnings estimates, improving from a projected loss of 3 cents to earnings of 1 cent per share over the past 90 days [4][5]. - The acquisition of the hemodialysis concentrates business from Evoqua has positioned Rockwell Medical as a key player in a consolidated market, enhancing its sales growth potential [7]. - The company has become the leading supplier of liquid bicarbonate in the U.S., allowing for better pricing strategies [8]. Market Positioning - Rockwell Medical has experienced a high rate of customer conversions from competitors and is expanding sales within its existing customer base, which is expected to positively impact third-quarter results [9]. - The stock has surged 137.7% in the third quarter, outperforming the industry and key rivals [14]. Future Outlook - The company aims to maintain annual revenues above$ 100 million and achieve gross margins of up to 30% while expanding beyond concentrates [18]. - RMTI's forward 12-month price-to-sales (P/S) ratio is 1.09X, significantly lower than the industry average of 5.61X, indicating potential undervaluation [19].