ZOM Stock Price News: Zomedica Corp shares continue to fall post Truforma sale

Zomedica (ZOM) shares have suffered since the sale of its first Truforma product.
ZOM shares closed up 2% on Friday.
ZOM shares still up significantly in 2021 as retail investors back it.

Stocks Reporter FXStreet

Update March 22: Shares in ZOM continue to fall post the first sale of its Truforma diagnostic product. ZOM shares are down over 4% in Monday's pre-market session. ZOM shares had recovered slightly on Friday in line with the broader market.

Update: ZOM shares continue to suffer from post-Truforma sale as investors likely move on to the next meme name, or back to the king, in Gamestop. ZOM does have a solid investment case but not at this level with a $1.99 market capitalization in a market that in its entirety is worth just over $2 billion for diagnostic pet products. Maybe investors have realized they have pushed the valuation too far or maybe they have moved into the next meme stock but either way ZOM shares have been struggling, despite the positive news, which is never a good sign.

NYSEAMERICAN: ZOM had investors believing that the upcoming sales of its Truforma diagnostic platform would justify the 1,300% growth over the past year. Well, so far they were unfortunately wrong. On Thursday, Zomedica continued its downward slide as the stock dropped by 6.67% to close the trading session at $2.10. Shares have now fallen nearly 20% since the start of the week, and it could just be bad timing for Zomedica as the recent market correction has hit growth stocks especially hard.

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To start the week, Zomedica did announce its first official sale of Truforma to an animal care center in New York. It was the moment that investors had been waiting for since the diagnostics platform for cats and dogs has been in development over the past few years. Surprisingly, the sales were met with a steep drop off in the stock’s price, a sign that shareholders are wising up to the high valuation. Truforma first reached mainstream appeal when Carole Baskin of the Tiger King fame, mentioned the platform in a paid video on YouTube. Since then, Zomedica has graduated to a full on Reddit meme stock which helped to propel its stock to its current price levels.

ZOM Stock forecast

Investors are quickly figuring out that Wall Street estimates of $20 million in sales by 2023 simply does not jive with an inflated $2 billion market cap that Zomedica now has. That gives Zomedica a forward looking price to sales ratio of 100, which illustrates just how overvalued Zomedica’s stock may still be.

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