You probably remember the iconic 1970s television show The Six Million Dollar Man, about a wounded astronaut who is given superhuman strength through bionic implants. The popular series led to a spin-off, The Bionic Woman.

Today, several companies in the field of human bionics are turning science fiction into science fact. Chief among these technology innovators is Ekso Bionics Holdings (NSDQ: EKSO), based in Richmond, California.

Ekso designs, develops and sells exoskeletons for use in the health care, industrial, and military markets around the world.

An exoskeleton is the external skeleton that supports and protects an animal’s body, in contrast to the interior skeleton (endoskeleton). Demand is increasing for artificial exoskeletons made of super-tough, ultra-light materials to assist human beings that suffer debilitating injuries or engage in potentially harmful tasks.

Ekso’s products stir the imagination. But should the stock stir your interest?

In this edition of Investing Daily we will discover:

• Why does Ekso generate so much investor attention?
• Should you buy Ekso?
• Should you sell Ekso?
• Our overall forecast and outlook for Ekso.

Let’s get into it!

What Is Ekso?

With a market cap of $132.1 million, Ekso operates via three divisions: Medical Devices, Industrial Sales, and Engineering Services.

The company’s main product is Ekso GT, a bionic suit that allows users with spinal cord or limb injuries to stand and walk using a cane, crutches, or walker. Injured military veterans are key customers for Ekso GT.

Ekso holds licensing agreements with aerospace/defense giant Lockheed Martin (NYSE: LMT) and works closely with local research universities.

This video shows how Ekso’s products augment the human body:

How Has Ekso Stock Performed?

Despite the technological allure of Ekso’s products, the company’s stock has generally underperformed. Over the past 12 months, Ekso has gained 7.4% compared to 5.3% for the S&P 500. Over the past two years, Ekso has lost 47.7% versus a gain of 24.7% for the S&P 500. Over the past five years, Ekso has lost 87.3% vs. a gain of 48.2% for the S&P 500.

How Has Ekso Performed In 2017/2018?

In 2017, Ekso lost 47.5% vs. a gain of 19.4% for the S&P 500. In 2018 year-to-date, Ekso has gained 5.8% and the S&P 500 has gained 0.9%.

Who Are Ekso’s Rivals?

Ekso’s rivals are mostly small firms; the field has attracted a host of entrepreneurial start-ups and private companies. Here’s a look at three publicly traded competitors.

CYBERDYNE (OTC: CYBQY)

With a market cap of $1.5 billion, Japan-based CYBERDYNE dwarfs most of its competitors in the exoskeleton market.

CYBERDYNE develops and sells exoskeleton equipment and systems for medical and industrial uses. The firm provides medical devices to treat patients with cerebral, nervous, and spinal cord injuries. CYBQY is more diversified than its closest competitors, making a range of robots for commercial uses such as cleaning elevators and floors in office buildings.

ReWalk Robotics (NSDQ: RWLK)

Based in Israel, ReWalk (market valuation: $22.2 million) designs, develops and markets exoskeletons for wheelchair-bound individuals.

ReWalk offers a commercial bionic walking assistance system that uses powered leg attachments to enable paraplegics to stand upright, walk and climb stairs. The company’s ReWalk Personal product is designed for everyday use for paraplegic individuals.

Bionik Laboratories (OTC: BNKLD)

Bionik (market cap: $19.4 million), based in Canada, is a robotics company that focuses on rehabilitation and mobility solutions for individuals with neurological ailments. The company offers prosthetics and related robotic products.

Among Bionik’s key products is InMotion Systems, which allows clinicians to provide sensor motor therapy to the shoulder and elbow to develop new neural pathways.

Will Ekso Go Up In 2019 (Should You Buy)?

Ekso occupies a promising growth industry. According to data firm Market Research Engine (MRE), the exoskeleton market’s annual revenues are expected to exceed more than $2.5 billion by 2024, for a compound annual growth rate of 24% in the given forecast period (starting in 2017).

The global exoskeleton market’s growth is fueled by technological innovation, the rising occurrence of spinal cord injuries and paralysis cases, increasing prevalence of strokes, and a growing geriatric population.

Ekso is involved in myriad areas of exoskeleton research and development, especially in pneumatic capabilities. The following chart, compiled with data from MRE, shows types of exoskeleton technologies and their projected growth rates:

Ekso enjoys multiple channels for marketing and distribution, including rehabilitation, industrial, home, wellness, pediatric, and military.

Wounded war veterans from overseas engagements in such places as Afghanistan and Iraq are boosting demand. Ekso has made important inroads into the military market, with government and defense industry contacts that pay off with coveted contract awards. In particular, by focusing on the treatment of wounded war vets, Ekso has been able to secure contracts with the Veterans Administration.

Ekso also offers an exoskeleton vest to assist workers in such settings as factories, warehouses or loading docks. The device alleviates the strains of repetitive heavy lifting. These industrial uses convey huge growth potential. In 2018, Ekso partnered with Ford Motor (NYSE: F) to provide mechanical suits for the carmaker’s factory workers to enhance their endurance and prevent injuries.

Ekso’s industrial-purpose vest also meets strict U.S. Navy shipyard specifications and is poised to capture contracts for heavy lifting purposes across several military services.

Meanwhile, Ekso is laying the groundwork to penetrate the Chinese market by seeking junior venture partners in that country.

Read Also: Apple Stock Prediction

Will Ekso Go Down In 2019 (Should You Sell)?

Ekso continually seems on the cusp of taking off but a sustained upward trajectory has remained elusive. Despite a few temporary spikes, the stock has performed poorly over the long haul and the company’s financial fundamentals aren’t encouraging.

The firm’s 12-month trailing (TTM) operating margin stands at -285.9%; earnings before interest, taxes, depreciation and amortization (EBITDA) is -$28.3 million.

Ekso’s total debt-to-equity ratio (most recent quarter) is 99.64, which is high by any standard. The company has consistently posted earnings losses in its quarterly earnings reports.

A red flag for investors is the company’s history of financial fraud, for which a top insider was jailed.

Overall Ekso Forecast And Prediction For 2019

For Ekso, the bear case prevails.

Ekso’s products are easily replicated by other technology companies; the barriers to entry aren’t high. What’s more, the company’s planned foray into China, ostensibly a future growth driver, is likely to be stymied by the escalating U.S.-China trade war.

Ekso also is constrained by a lack of reliable and comprehensive reimbursement for its medical products by government entities, an impediment that often requires buyers to seek private funding. The capital cost of an Ekso product ($80,000-$100,000) hinders widespread adoption, especially for budget-strapped health care and rehabilitation facilities.

It’s unlikely that a catalyst will occur in 2019 that can significantly move the needle on Ekso’s moribund share price. Cheaper products from competitors continually come to market. Meanwhile, the company remains vulnerable to external shocks, such as canceled or delayed government contracts, that could torpedo the stock.

Ekso Bionics occupies an exciting field but the company is plagued with too many intrinsic weaknesses. Avoid the stock; it doesn’t take bionic powers to see the risks.

John Persinos is the managing editor of Investing Daily.