Why Is STIM Stock Rallying 16% After-Hours?

• The shareholder instead recommended that the company’s  clinic business operate on a standalone basis.
• Neuronetics on Monday reaffirmed its fiscal year 2026 guidance of revenue in the range of $160 million-$166 million and gross margin of 47% to 49%. 
• The company also said that Steven E. Pfanstiel will depart from his role as CFO to pursue an opportunity outside the company.

Shares of Neuronetics Inc. (STIM) jumped as much as 16% after-hours on Monday before paring back gains after the firm’s largest independent shareholder called upon its board of directors to conduct a review of strategic alternatives, highlighting the company’s finite resources.

Jorey Chernett, who owns about 14% of the company's outstanding shares, urged the board to consider options including the sale of its Transcranial Magnetic Stimulation (TMS) business unit under which it operates treatment centers across the U.S.

The shareholder instead recommended that the company’s clinic business operate on a standalone basis. According to Chernett, the company has two compelling high-quality assets with expanding total addressable markets. The company also noted that the expected synergies of combining TMS and Greenbrook in December 2024 have not materialized thus far.

“Since the December 2024 acquisition, pure-play peers have dramatically outperformed STIM and now trade at substantially higher multiples,” they said, while adding that the company has only finite resources which cannot serve both distinct businesses.

CFO Exit

Neuronetics on Monday reaffirmed its fiscal year 2026 guidance of revenue in the range of $160 million to $166 million and gross margin of 47% to 49%.

The company also said that Steven E. Pfanstiel will depart from his role as Chief Financial Officer (CFO) to pursue an opportunity outside the company. The company is now on the lookout for a replacement for Pfanstiel, who will remain with the company through May 1.

How Did Retail Traders React?

On Stocktwits, retail sentiment around STIM stock jumped from ‘neutral’ to ‘bullish’ territory over the past 24 hours, while message volume increased from ‘normal’ to ‘high’ levels.

STIM stock has dropped 50% over the past 12 months. 

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