Pregnancy care specialist Nuvo Group (NASDAQ:NUVO) — a pioneer in remote pregnancy monitory — saw its shares pop dramatically higher on Monday. On Thursday of last week, the NUVO stock ticker entered the public market via a reverse merger with a blank-check firm. While the underlying enterprise offers multiple relevancies, such mergers have poor track records.
According to the company’s press release, Nuvo attempts to address the health disparities found in society. It accomplishes this directive through INVU, a pregnancy monitoring and management platform. Utilizing wearable technology, artificial intelligence (AI) and machine learning (ML), INVU provides both patients and healthcare providers with real-time maternal-fetal health data.
Notably, the Food and Drug Administration (FDA) has cleared the INVU platform, which allows healthcare professionals to conduct fetal non-stress tests (NSTs) with patients anywhere. Such flexibility greatly enhances care accessibility. It also reduces staff burdens while simultaneously boosting the quality of care.
Nuvo’s head executive is Rice Powell, who commands 40 years of experience in the healthcare industry. Previously, he held senior roles at Biogen (NASDAQ:BIIB) and Baxter International (NYSE:BAX).
NUVO Stock Faces Uncertainties Despite the Positives
In discussing the business combination that brought NUVO stock public, Powell emphasized the challenges associated with the “broken” pregnancy care system and how Nuvo can help. “Becoming a public company provides us with the resources to redefine pregnancy care and address health disparities by ensuring that all expectant mothers can receive timely and accurate care, regardless of their background or location,” the CEO stated.
On April 1 of this year, shareholders of LAMF Global Ventures Corp. I, a special purpose acquisition company (SPAC), approved the combination that took NUVO stock public. Per the press release, this move will “enable Nuvo to access capital markets to fuel commercial growth, international expansion, and expedite its innovation pipeline.”
Despite the noble directive of addressing health disparities, the nagging issue for NUVO stock moving forward is its viability. During the early years of the Covid-19 pandemic, SPACs were all the rage as they provided an interesting twist to the traditional initial public offering (IPO). However, the novelty quickly faded, with many enterprises losing shareholders money post-reverse merger.
Even NUVO stock itself — while up massively on Monday — is well off from its initial $10 offering price.
Why It Matters
Despite the challenges tied to NUVO stock, the underlying company carries the advantage of exceptional relevance. According to a study published by the National Library of Medicine, various obstacles — such as service cost and time waiting for care — represent key prenatal care barriers. The INVU platform could potentially mitigate many of these pain points, thus enhancing Nuvo’s profile.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
