Ekso Bionics Holdings Inc (NASDAQ:EKSO) Is At An Inflection Point This Month

Ekso Bionics Holdings, Inc. (NASDAQ:EKSO) is one we've looked at on a couple of occasions in the past. The company is full of potential, and could easily become a leader in its field going forward, but to date, hasn’t made for an easy holding. To say the twelve or so months have been a roller coaster would be a dramatic understatement – the 52-week range spans $0.88-$6.79.Current price is around the $3.33 mark, so not far off mid-point on the 52-week range, but there are concerns that, after dipping into an early March earnings release, Ekso is going to struggle to run towards the above mentioned highs as 2017 matures.There's some credence to these concerns, of course. This is a young health tech stock that's trying to create and establish a market, not just bring a product to one. That's a costly, and time consuming, thing to do, and will always draw concerns that bigger, deeper pocketed competitors can throw more money at the problem and finish up on top (even if they have inferior products).We think this one's finally about to start drawing some positive sentiment, however, and as it does, we expect the company to stage a recovery.Why?Well, in April last year, Ekso picked up FDA approval for its lead product – an exoskeleton called Ekso GT. The approval covered the exoskeleton for use in the treatment of individuals with hemiplegia due to stroke, individuals with spinal cord injuries at levels T4 to L5, and individuals with spinal cord injuries at levels of T3 to C7.The thing to recognize with products in this space is that they are often used without FDA approval (there are some companies doing this in the US right now) but an FDA approval means you can actually market said product to the healthcare professionals that are going to be using it to help their patients.This is key to our thesis, so keep it in mind.The second important thing to note is Ekso's sales team is pushing these units to hospitals. These hospitals have certain buying protocols, and this affects the sales cycle dramatically. Doctors aren’t just buying these things and keeping them in their offices. Even if they love the product, they've got requisition it, get approval from the upper echelons of the establishment in question, and more. This means there's a sales cycle of twelve months or more for these devices. The company actually illustrates this in a presentation it just gave at at ROTH.Ekso picked up approval for the GT twelve months ago. This means that the demos its sales team were able to give (those that basically kick start the sales cycle) really started to be effective twelve months ago, and so we should see a steep bump in the conversion of these demos from pitch to purchase order come in right about now.In other words, sales to date have not been representative of the actual sales potential of these devices. From pretty much exactly the current point in time, the conversion rate should pick up (and to reiterate, this is because the sales team is actually allowed to say the product is good for so and so condition now, and it wasn’t previously), and the sales should start to fall in line with the underlying representative value of these units to physicians and patients.We should start to see this shift fall into place from next earnings on out.Of course, there's also the industrial and home target devices adding to this thesis, with the former of these ramping up quarter over quarter.It's not a risk free play, like we've said. There's competitor risk, some inevitable dilution going forward (likely towards the end of this year, Ekso just raised last month) and the inherent risk of an extended sales cycle. As a long term allocation, however, this one looks promising, and we should finally start to see it's PPS stabilize, and grow steadily, from here on out.We will be updating our subscribers as soon as we know more. For the latest updates on EKSO, sign up below!Disclosure: We have no position in EKSO and have not been compensated for this article.