IRadimed Corp.'s (IRMD:NASDAQ) Q2/23 financial results were "at the high end of expectations," and based on higher forecasts, ROTH Capital Partners raised its target price on the medical technology firm, reported analyst Scott Henry in an Aug. 7 research note.
This company develops, manufactures, and distributes magnetic resonance imaging (MRI)-compatible medical devices and related accessories and services.
ROTH's new target on IRadimed is US$55 per share, up from US$50, reflecting a 10% increase, noted Henry. This resulted from the financial services firm increasing its revenue and earnings per share (EPS) estimates for 2024.
Given IRadimed's current share price is about US$48.42 per share, the return to target implies a 14% return for investors.
The Florida-based company remains a Buy.
Revenue Beats Expectations
Henry reviewed IRadimed's Q2/23 financial results. The highlight was revenue, which was US$16.1 million (US$16.1M). It was up 27% year over year and 4% quarter over quarter. Also, it exceeded ROTH's US$15.7M forecast.
The pump segment drove revenue, noted Henry, generating US$4.5M, ahead of ROTH's US$3.9M estimate. Disposables revenue also was a beat, at US$5.3M, against ROTH's US$5M estimate.
Monitors revenue, however, fell short of ROTH's US$6.5M projection, coming in at US$6.1M.
"This is largely timing related, and we expect that Monitors will drive growth the rest of the year," Henry wrote.
Sales of IRadimed's new ferrous metal detector product totaled US$183,000, less than ROTH's US$325,000 target.
Gross margins trailed ROTH's estimate, coming in at 75.5% compared to 77%. Gross profit was in line at US$12.2M versus US$12.1M.
IRadimed spent US$7.2M during Q2/23, less than ROTH's US$7.7M forecast.
Net EPS was US$0.36, which exceeded ROTH's US$0.31 projection.
Guidance Gets Boost
Henry reported IRadimed increased its revenue guidance for full-year 2023 to US$64.5–US$65.5M from US$62–US$63.5M.
Similarly, earnings per share is now estimated to be between US$1.37 and US$1.40, up from US$1.26–1.35.
What To Watch For
The med tech company has some material catalysts ahead, Henry pointed out.
In 2024, IRadimed expects to gain a greater share of the MRI monitors market, an opportunity worth about US$100M in revenues annually, as estimated by ROTH. Henry noted that Philips, also in the MRI market, seems less focused on this segment, and this should benefit IRadimed.
A major stock-moving event on track for early 2025 is the company taking its next-generation pump to market. Management now targets Q1/24 for resubmitting the application for it to the U.S. Food and Drug Administration, and the agency is taking about a year to review and approve it.
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- Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
- This article does not constitute medical advice. Officers, employees and contributors to Streetwise Reports are not licensed medical professionals. Readers should always contact their healthcare professionals for medical advice.
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Disclosures for Roth, iRadimed Corp., August 7, 2023
Regulation Analyst Certification ("Reg AC"): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.
Disclosures: ROTH makes a market in shares of iRadimed Corporation and as such, buys and sells from customers on a principal basis. Within the last twelve months, ROTH has received compensation for non-investment banking securities-related services from iRadimed Corporation.
ROTH Capital Partners, LLC expects to receive or intends to seek compensation for investment banking or other business relationships with the covered companies mentioned in this report in the next three months. The material, information and facts discussed in this report other than the information regarding ROTH Capital Partners, LLC and its affiliates, are from sources believed to be reliable, but are in no way guaranteed to be complete or accurate. This report should not be used as a complete analysis of the company, industry or security discussed in the report. Additional information is available upon request. This is not, however, an offer or solicitation of the securities discussed. Any opinions or estimates in this report are subject to change without notice. An investment in the stock may involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Additionally, an investment in the stock may involve a high degree of risk and may not be suitable for all investors. No part of this report may be reproduced in any form without the express written permission of ROTH. Copyright 2023. Member: FINRA/SIPC.