In a July 29 research note, ROTH Capital Partners LLC Healthcare and Medical Technology Analyst Scott R. Henry, CFA advised that magnetic resonance imaging (MRI) compatible medical device maker IRadimed (IRMD:NASDAQ) posted solid operating results during Q2/22 that were modestly higher than expectations.
The analyst highlighted that in Q2/22 earnings report the company maintained 2022 revenue and earnings per share (EPS) guidance and saw strength in both its monitors and pumps, which now appears to indicate that the estimates may be on the conservative side. In addition, approval for the firm's next generation pump remains on schedule for Q4/22.
For Q2/22. IRadimed Corp. posted revenue of $12.7 million ($12.7M) which exceeded ROTH's forecast for $12.6M. In the quarter gross margin came in at 79.7%, ahead of ROTH's 76.8% estimate resulting in a gross profit of $10.1M which also exceeded the research firm's forecast for $9.7M.
The analyst advised that in Q2/22 IRadimed had non-GAAP EPS of $0.26 per share, which exceeded ROTH's target by $0.02 per share.
IRadimed's revenues in the latest quarter grew 30% year-over-year to $12.7M. Total revenues consisted of $3.9M from Pump revenue, $4.9M from Monitor revenue, and $3.9M from Disposables/services revenue. Both Pump and Monitor revenues came in slightly higher than expected, while the Disposables/services segment performed at the lower range of ROTH Capital's estimates.
The company did not sell any of its new MRI Ferrous Metal Detector (FMD) products during Q2/22. ROTH said it thought that this area would contribute about $300,000 ($300K) in revenue but added that management is targeting twelve booked sales in Q3/22.
The analyst mentioned that there are a few positive takeaways from the Q2/22 results. IRadimed advised that it is maintaining its FY/22 revenue estimates of $52.5-53.2M and non-GAAP EPS guidance of $0.96-1.03. ROTH Capital noted that its forecasts are presently at the upper end of IRadimed's EPS guidance.
Another key point is that IRadimed's management remains confident that its next-generation pump will gain approval from the U.S. FDA in late September or October which would likely make this a Q4/22 event. The pump device is expected to offer an easier interface. This approval might provide a positive catalyst for the company since the firm's FY/22 revenue guidance does not include any revenues from sales of this equipment.
IRadimed is a medical device company that designs, manufactures, and sells MRI-compatible devices and accessories to hospitals, acute care facilities, and outpatient imaging centers in the U.S. and world markets. The firm's product line includes the MRidium MRI-compatible intravenous (IV) infusion pump system and an MRI-compatible patient vital signs monitoring system. The company also offers related accessories, sensors, and equipment such as non-magnetic IV poles, wireless displays and controls, and monitoring equipment.
ROTH Capital Partners advised that it is maintaining its "Buy" rating for IRadimed Corp. and is increasing its price target by $2 per share to $42. The research firm noted that it raised its price target on account of increases in its 2022 non-GAAP EPS forecast and the company's larger cash balances.
The firm indicated that it arrived at its 12-month price by utilizing a ~36x multiple of ROTH's forecasted FY/22E non-GAAP EPS of $1.03 and then adding approximately $4/share based upon IRadimed's net cash position.
IRadimed Corp. shares trade on the Nasdaq Exchange under the symbol "IRMD" and last closed for trading at $38.36 on Tuesday, August 2, 2022. The company has approximately 12.56 million outstanding shares and a market cap of around $530.69 million. The firm's shares have traded in a 52-week range of $28.90-55.92/share.
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Disclosures for Roth Capital Partners., iRadimed Corporation, July 29, 2022
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.
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 2022. Member: FINRA/SIPC.