What’s Next For Nevro Stock After A 22% Fall In A Month?

NVRO: Nevro logo

[Updated: Nov 26, 2021] NVRO Stock Decline

The stock price of Nevro (NASDAQ: NVRO), a medical devices company, has seen a large 22% fall in a month. This can largely be attributed to the outcome of a lawsuit against Nevro for patent infringement, with the jury siding with Boston Scientific and finding Nevro to have infringed two of Boston Scientific’s patents for manufacturing of spinal cord simulation leads. The jury has asked Nevro to pay $20 million to Boston Scientific in royalties.

Furthermore, the company reported its Q3 results earlier this month, with revenue of $93 million (down 14% y-o-y), slightly above the $92 million consensus estimate, but its loss per share of $1.44 was much higher than the consensus estimate of $0.87 loss per share. The company saw its gross margin as well as operating margin contract during the quarter. Also, the company provided fourth quarter outlook with revenues to be in the range of $94 and $98 million, down between 11% and 14% compared to the prior year quarter, and this guidance was well below the consensus estimate of $114 million. Falling revenues, margin contraction, and loss of a lawsuit, did not sit well with the investors, resulting in a sharp decline in NVRO stock over the last month.

But now that NVRO stock has fallen a large 22% in a month, will it continue its downward trajectory, or is a rise imminent? Going by historical performance, there is a strong chance of a rise in NVRO stock over the next month. Out of 67 instances in the last seven years that NVRO stock saw a twenty-one day fall of 22% or more, 56 of them resulted in NVRO stock rising over the subsequent one-month period (twenty-one trading days). This historical pattern reflects 56 out of 67, or about a 84% chance of a rise in NVRO stock over the coming month. See our analysis on Nevro Stock Chances of Rise for more details.
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While NVRO stock may see a rebound going forward, it is helpful to see how its peers stack up. Check out Nevro Stock Comparison With Peers to see how NVAX stock compares against peers on metrics that matter. You can find more such useful comparisons on Peer Comparisons.

Calculation of ‘Event Probability‘ and ‘Chance of Rise‘ using last seven years data

  • After moving 0.9% or more over a five-day period, the stock rose in the next five days on 52% of the occasions.
  • After moving -8.7% or more over a ten-day period, the stock rose in the next ten days on 53% of the occasions
  • After moving -22.0% or more over a twenty-one-day period, the stock rose in the next twenty-one days on 84% of the occasions.


[Updated: Jun 30, 2021] Nevro Stock Decline

The stock price of Nevro (NASDAQ: NVRO), a medical devices company, has seen a 7% drop over the last five trading days, despite the company announcing positive findings from its spinal cord stimulation clinical trials for painful diabetic neuropathy. While NVRO stock did respond positively to this development last week, it has slid over 7% so far in this week due to the company’s management stating that the pace of the recovery in demand over the recent months wasn’t as strong as earlier anticipated. [1] It is likely that Nevro’s Q2 results may be below the company’s provided guidance of $105 million at the mid-point of its range.

Now that NVRO stock has fallen 7% in just five days, will it resume its downward trajectory over the coming weeks, or is a rise in the stock imminent? According to the Trefis Machine Learning Engine, which identifies trends in the company’s historical stock price data, returns for NVRO stock average nearly 5.3% in the next one-month (21 trading days) period after experiencing a 7% drop over the previous week (five trading days).

But how would these numbers change if you are interested in holding NVRO stock for a shorter or a longer time period? You can test the answer and many other combinations on the Trefis Machine Learning Engine to test Nevro stock chances of a rise after a fall. You can test the chance of recovery over different time intervals of a quarter, month, or even just one day!

Some Fun Scenarios, FAQs & Making Sense of Nevro Stock Movements:

Question 1: Is the average return for Nevro stock higher after a drop?

Answer: Consider two situations,

Case 1: Nevro stock drops by -5% or more in a week

Case 2: Nevro stock rises by 5% or more in a week

Is the average return for Nevro stock higher over the subsequent month after Case 1 or Case 2?

NVRO stock fares better after Case 1, with an average return of 5.1% over the next month (21 trading days) under Case 1 (where the stock has just suffered a 5% loss over the previous week), versus, an average return of 3% for Case 2.

In comparison, the S&P 500 has an average return of 3.1% over the next 21 trading days under Case 1, and an average return of just 0.5% for Case 2 as detailed in our dashboard that details the average return for the S&P 500 after a fall or rise.

Try the Trefis machine learning engine above to see for yourself how Nevro stock is likely to behave after any specific gain or loss over a period.

Question 2: Does patience pay?

Answer: If you buy and hold Nevro stock, the expectation is over time the near-term fluctuations will cancel out, and the long-term positive trend will favor you – at least if the company is otherwise strong.

Overall, according to data and Trefis machine learning engine’s calculations, patience absolutely pays for most stocks!

For NVRO stock, the returns over the next N days after a -5% change over the last 5 trading days is detailed in the table below, along with the returns for the S&P500:

You can try the engine to see what this table looks like for Nevro after a larger loss over the last week, month, or quarter.

Question 3: What about the average return after a rise if you wait for a while?

Answer: The average return after a rise is understandably lower than after a fall as detailed in the previous question. Interestingly, though, if a stock has gained over the last few days, you would do better to avoid short-term bets for most stocks – although NVRO stock appears to be an exception to this general observation.

It’s pretty powerful to test the trend for yourself for Nevro stock by changing the inputs in the charts above.

While NVRO stock may see higher levels, 2020 has created many pricing discontinuities which can offer attractive trading opportunities. For example, you’ll be surprised how counter-intuitive the stock valuation is for Novanta vs Abbott.

What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio that’s beaten the market consistently since the end of 2016.

Returns Nov 2021
MTD [1]
YTD [1]
Total [2]
NVRO Return -22% -47% 27%
S&P 500 Return 3% 25% 110%
Trefis MS Portfolio Return -2% 49% 304%

[1] Month-to-date and year-to-date as of 11/26/2021
[2] Cumulative total returns since 2017

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  1. Nevro’s painful diabetic neuropathy data marred by disappointing Q2 forecast, MedTech Dive, Jun 28, 2021 []