Why the Avita Medical (ASX:AVH) share price is slipping lower today

The Avita Medical (ASX: AVH) share price is falling lower today as the company announced its half-year report. We take a closer look.

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The Avita Medical Inc (ASX: AVH) share price has stayed in the red today since the company announced its half-year results this morning.

At the time of writing, shares in the regenerative medicine company are down 2.66% at a price of $6.23.

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Image source: Getty Images

A look at the half-year results

For the half-year ending 31 December 2020, Avita Medical reported a substantial revenue increase from the sale of its goods. Revenue rose to $10.16 million up 56% from the previous corresponding period. However, despite the positive returns, net loss also expanded. The company posted a net loss of $15.87 million, which was up 13% from the first half of FY20.

The widening loss may be weighing on investors' minds this afternoon as the stock is being sold off. But while shareholders will be regretting the fall, shorters of the stock will be pleased as the company continues its troubled run. Avita Medical remains the eighth most shorted stock on the ASX this week.

Moreover, the company reported a disappointing quarterly report last week, which saw its share price slide 11%. In the report, the company announced a strong cash balance of $59.8 million.

Critically it did not provide guidance to the market due to the prevailing uncertainty stemming from the coronavirus pandemic. The small-cap health share advised that its accounts were highly susceptible to the impacts of COVID-19 because its revenue came predominantly from 20 physicians.

About the Avita Medical share price

Avita Medical is a regenerative medicine company based in the United States. The company's main offering is Recell, a spray-on treatment used for burn victims. Avita currently boasts a market capitalisation of $136 million.

The Avita share price has had a torrid time of late and is down 63% on the same time last year. The share has not fully recovered from the impacts of COVID-19 and remains some way off its 52-week high of $9.11.

Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Avita Medical Limited. The Motley Fool Australia has recommended Avita Medical Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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