First steps on path towards longer-term profitability

Update | 2 March 2022

Share this note

Nexstim delivered its first ever profitable period in H221 and is guiding towards continued revenue growth and a positive operating result for FY22. Profitability and partnerships are central to FY22 strategic objectives. The recent Magnus Medical and PNC Management Services deals are trailblazers for a new technology licencing revenue stream and a deeper partnership business model for the US NBT therapy business respectively. The former deal includes a $4m upfront payment which addresses Nexstim’s prior funding shortfall, and its structure means that in the near-term, the company is able to direct its internal resources towards supporting global growth in diagnostics, US NBT partner clinics, and ex-US opportunities for the therapy business. Our updated model values Nexstim at €58.1m (€8.69 per share).

Year-end: December 31202020212022E2023E
Revenues (€m)4.16.411.911.7
Adj. PBT (€m)(4.2)(1.9)1.40.1
Net Income (€m)(4.1)(0.8)1.50.2
EPS (€)(0.02)(0.00)0.220.03
Cash (€m)
EBITDA (€m)(3.0)(1.0)2.20.8
Source: Trinity Delta
  • Operational execution in FY22  The first FY22 strategic objective is financial: profitable net sales growth, operating profitability, and minimising future capital needs. The second focuses on building and expanding the network of partner clinics, especially in the US. Growth is anticipated in both NBS (diagnostics) and NBT (therapy) businesses, with rising system utilisation likely to boost recurring revenue. To date 200+ institutions have NBS systems, while 51 systems with therapy capabilities have been placed (21 US, 30 Europe/RoW) including both NBT and NBS5+ systems. There is growing interest in the latter which combines diagnostic and therapeutic applications on one platform.
  • A new licencing revenue stream The Magnus Medical deal brings in welcome funds, provides Nexstim with a share in the economics of the US opportunity for accelerated therapy protocols in neuropsychiatry, and is the first licence granted by Nexstim for commercial use of its NBT technology and patents. Deal terms include a $4m (€3.5m) upfront plus up to c $15m (€13m) in sales royalties over five years. While Nexstim has some restrictions on NBT sales in the US, this deal does not impinge on existing US therapy customers or impact the US diagnostic opportunity.
  • Solid revenue performance   FY21 net sales of €6.4m (FY20: €4.1m, +55%), include €3.7m in system sales (FY20: €1.7m, +113%) and recurring revenues of €2.7m (FY20: €2.4m, +13%). NBS sales performed strongly rising 71% to €3.7m, with NBT growth of 38% (€2.7m). End-FY21 cash of €5.2m was subsequently boosted by the €3.5m Magnus Medical upfront, funding Nexstim to sustainable profitability.
  • Valuation of €8.69/share  Updating our DCF-based rNPV model for FY21 results and recent deals generates a valuation of €58.1m (equivalent to €8.69/share or €7.99 fully diluted), which should rise with execution on strategic priorities.


2 March 2022

Market Cap€32.6m
Enterprise Value€27.4m
Shares in issue6.69m
12 month range€3.41-7.77
Free float73.6%
Primary exchangeHelsinki
Other exchangesStockholm
Corporate clientYes

Company description

Nexstim is a targeted neuro-modulation company that has developed a proprietary navigated rTMS platform for use in diagnostics (NBS) and therapeutics (NBT). NBS is used in planning brain surgery while NBT is focused on depression and chronic pain. FDA approval for depression was given in 2017, and the focus is on commercial roll out in the US, Europe and Asia.


Lala Gregorek
+44 (0) 20 3637 5043

Franc Gregori
+44 (0) 20 3637 5041

Exhibit 1: Summary of financials
Source: Company, Trinity Delta Note: The accounts are produced according to Finnish GAAP. Sales forecasts do not include any contribution from indications yet to be approved. Historic EPS, DPS and Average no. of shares have been adjusted to reflect the 100:1 share consolidation in May 2021.


Trinity Delta Research Limited (“TDRL”; firm reference number: 725161), which trades as Trinity Delta, is an appointed representative of Equity Development Limited (“ED”). The contents of this report, which has been prepared by and is the sole responsibility of TDRL, have been reviewed, but not independently verified, by ED which is authorised and regulated by the FCA, and whose reference number is 185325.

ED is acting for TDRL and not for any other person and will not be responsible for providing the protections provided to clients of TDRL nor for advising any other person in connection with the contents of this report and, except to the extent required by applicable law, including the rules of the FCA, owes no duty of care to any other such person. No reliance may be placed on ED for advice or recommendations with respect to the contents of this report and, to the extent it may do so under applicable law, ED makes no representation or warranty to the persons reading this report with regards to the information contained in it.

In the preparation of this report TDRL has used publically available sources and taken reasonable efforts to ensure that the facts stated herein are clear, fair and not misleading, but make no guarantee or warranty as to the accuracy or completeness of the information or opinions contained herein, nor to provide updates should fresh information become available or opinions change.

Any person who is not a relevant person under section of Section 21(2) of the Financial Services & Markets Act 2000 of the United Kingdom should not act or rely on this document or any of its contents. Research on its client companies produced by TDRL is normally commissioned and paid for by those companies themselves (‘issuer financed research’) and as such is not deemed to be independent, as defined by the FCA, but is ‘objective’ in that the authors are stating their own opinions. The report should be considered a marketing communication for purposes of the FCA rules. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and it is not subject to any prohibition on dealing ahead of the dissemination of investment research. TDRL does not hold any positions in any of the companies mentioned in the report, although directors, employees or consultants of TDRL may hold positions in the companies mentioned. TDRL does impose restrictions on personal dealings. TDRL might also provide services to companies mentioned or solicit business from them.

This report is being provided to relevant persons to provide background information about the subject matter of the note. This document does not constitute, nor form part of, and should not be construed as, any offer for sale or purchase of (or solicitation of, or invitation to make any offer to buy or sell) any Securities (which may rise and fall in value). Nor shall it, or any part of it, form the basis of, or be relied on in connection with, any contract or commitment whatsoever. The information that we provide is not intended to be, and should not in any manner whatsoever be, construed as personalised advice. Self-certification by investors can be completed free of charge at TDRL, its affiliates, officers, directors and employees, and ED will not be liable for any loss or damage arising from any use of this document, to the maximum extent that the law permits.

Copyright 2022 Trinity Delta Research Limited. All rights reserved.