On Tuesday, Stifel, a financial services firm, announced an increase in the price target for OrthoPediatrics Corp. (NASDAQ: NASDAQ:KIDS) shares, raising it to $40 from the previous $34. The firm has also reaffirmed its Buy rating for the stock.
This adjustment follows OrthoPediatrics' strong performance in the first quarter of 2024, where the company reported sales of $44.7 million, surpassing both the firm's and consensus estimates of $41.5 million and $41.7 million, respectively.
The company's organic sales growth, which was up approximately 23% year-over-year, exceeded OrthoPediatrics' long-term target of over 20%. This growth was attributed to a combination of positive procedure trends in the first quarter, ongoing commercialization of legacy products, a series of new and recent product launches, and the normalization of international markets.
Despite the first quarter's outperformance, OrthoPediatrics has chosen to raise its 2024 sales guidance only by the amount of the beat, while maintaining its outlook for the rest of the year. This conservative stance is believed to be in anticipation of the normal seasonal variability that occurs during the summer months. Still, Stifel remains optimistic about the company's fundamentals and suggests there is potential for more "beat-and-raise" quarters in the future.
For the time being, Stifel's sales projections for the remainder of 2024 remain unchanged. The firm acknowledges the possibility of positive factors that could contribute to additional upside in OrthoPediatrics' performance throughout the year.
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